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Uphold Cryptocurrency Exchange Ordered to Pay $5 Million to New York Attorney General, 2026/05/04 11:28:39
The New York Attorney General’s office has announced the recovery of over $5 million from the American cryptocurrency exchange Uphold. The trading platform was accused of promoting the investment program CredEarn from the now-defunct platform Cred and misleading investors.
New York Attorney General Letitia James claims that from January 2019 to October 2020, Uphold advertised the CredEarn product on its website and mobile application, violating state laws. The creators of CredEarn promised investors substantial annual interest payments, while Uphold assured clients of the safety and reliability of this savings product. The exchange stated that Cred’s products were insured; however, in reality, retail investors were not protected from losses when investing in digital assets, according to the Attorney General’s office.
The Attorney General’s office reported that Cred profited by issuing risky microloans to borrowers in China with low monthly incomes and no credit history. Additionally, Uphold promoted CredEarn without being registered as a broker-dealer.
In March 2020, the Cred platform began to face financial difficulties after issuing risky and unprofitable loans, and by the end of 2020, it declared bankruptcy. As a result, thousands of Uphold clients worldwide who invested in CredEarn suffered multi-million dollar losses.
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Under the terms of the reached agreement, Uphold is required to pay $5 million to the affected investors—this amount is more than five times what the exchange earned from commission fees. All payments received by Uphold during the Cred bankruptcy proceedings, for which the exchange is owed $545,189, will also be distributed to the affected clients, according to the agreement.
Investors should expect to receive an email from Uphold notifying them of the funds being credited to their accounts. The Attorney General’s office also demanded that Uphold enhance client protection against fraud and register as a broker in the state of New York.
“Uphold promoted risky investments and misled its clients, convincing them of the safety of the CredEarn program. Unscrupulous market participants will always be held accountable for jeopardizing the financial security of their clients,” stated James.
In 2024, the New York Attorney General’s office required the cryptocurrency exchange Gemini, founded by twins Cameron and Tyler Winklevoss, to pay $50 million for launching the Gemini Earn program. The regulator claimed that over 230,000 investors were harmed by this financial product.
