Cryptocurrency trading platform Coin Cafe has been ordered to repay $4.3 million to its users after allegedly charging “exorbitant and undisclosed fees” for storing Bitcoin on the platform — leading to some accounts being drained entirely of its funds.
Based in Brooklyn, Coin Cafe initially filed an application for a virtual currency license with the New York State Department of Financial Services in July 2015; however, it was only approved in January this year.
Despite the seven-and-a-half-year application process, Coin Cafe was allowed to operate throughout but was flagged as putting “investors at risk,” as it didn’t uphold its obligation to register with the Office of the Attorney General for New York — which all New York broker-dealers are required to do so.
On May 18, it was revealed that the exchange had been charging “exorbitant” fees for storing Bitcoin without properly informing investors, leading to some cases in which investors’ accounts were wiped out entirely, according to New York State Attorney General Letitia James.
In a statement, James said tCoin…