Is KuCoin Safe? (2025 Update)

What is KuCoin?

KuCoin is a Singapore-based cryptocurrency exchange founded in 2017. The platform serves over 30 million users globally and has more than 700 cryptocurrencies available to trade. KuCoin is known for its wide selection of altcoins, trading bots, and advanced features that appeal to experienced traders.

What security features does KuCoin have?

Let's walk through some of KuCoin's security features:

• Cold storage: KuCoin stores the majority of user funds in offline cold storage, which protects cryptocurrency from online attacks. 
• Two-factor authentication (2FA): Users can enable SMS or Google Authenticator for additional account protection. 
• Address whitelisting: Withdrawal addresses can be restricted to pre-approved wallets only. 
• Proof of Reserves: KuCoin publishes regular third-party audits confirming reserves exceed 100% of user liabilities, with over 105% coverage for major assets like Bitcoin and Ethereum. 

Has KuCoin ever been hacked?

Yes, KuCoin suffered a major security breach. In September 2020, hackers stole over $285 million worth of cryptocurrency from KuCoin's hot wallets. The attack was later attributed to the Lazarus Group, a North Korean hacking collective.

Afterwards, KuCoin promised to reimburse/recover stolen customer funds. The company worked with law enforcement and blockchain analytics firms to recover customer crypto and implemented enhanced security measures following the incident.

Is KuCoin FDIC insured?

Crypto on KuCoin is not FDIC insured. Generally, cryptocurrency is not subject to FDIC protection.

What legal and regulatory issues has KuCoin faced?

KuCoin has faced significant legal challenges in recent years. In January 2025, the exchange settled with the U.S. Department of Justice over allegations of facilitating illegal financial transactions and failing to implement mandatory anti-money laundering (AML) policies. KuCoin pleaded guilty to unlicensed money transmission charges and agreed to pay $300 million in penalties.

As a result of this scandal, co-founders Chun Gan and Ke Tang are no longer involved in operations and KuCoin no longer operates in the US. 

Is KuCoin legal in the U.S.?

No. KuCoin exited the U.S. market in 2025 after its legal settlement with federal authorities. U.S. residents can no longer access KuCoin. 

Why should I use KuCoin?

KuCoin is a solid choice if you're looking for a wide selection of altcoins and advanced features like automated trading bots. 

What are the risks of using KuCoin?

Here are the main risks of using KuCoin:

• Custodial risk: Like all centralized exchanges, crypto held on KuCoin could be lost if the platform is hacked or goes bankrupt. In the past, customers have lost millions when exchanges like FTX and BlockFi went bankrupt. ‍
• Account-level threats: No matter what cryptocurrency platform you’re using, you should watch out for online threats. Your account could be compromised through phishing attacks and malware.

It’s recommended to protect yourself by enabling two-factor authentication, whitelisting withdrawal addresses, and moving long-term crypto holdings to a hardware wallet for additional protection. 

Does KuCoin report to tax authorities? 

Since 2023, KuCoin requires Know Your Customer (KYC) verification to access most core features, including trading and depositing cryptocurrency. It’s likely that KuCoin shares this information with relevant tax authorities upon request. 

Remember that you're required to report all crypto income and capital gains on your tax return, regardless of whether you receive a tax form. Crypto tax software like CoinLedger can automatically track your KuCoin trades and generate complete crypto tax forms in minutes. 

Conclusion

KuCoin offers strong security features like cold storage, two factor authentication, and ongoing Proof of Reserves audits. While the exchange was hacked in 2020, it’s considered a safe option for international investors.