The order to shut down the Coinseed trading app was given by the New York Supreme Court.
Coinseed, a cryptocurrency trading platform that allegedly converted its clients’ funds into the same Dogecoin coin without notifying them, has been asked to cease trading for good.
According to a report from Bloomberg, The order to shut down Coinseed comes after the New York attorney general sued the founders of the troubled exchange platform for fraud.
The main complaint against Coinseed concerned the platform’s decision to covertly convert customer funds into DOGE, the original coin meme that garnered massive interest from individuals following the support of Tesla CEO Elon Musk and other celebrities.
New York Attorney General Letitia James filed a lawsuit against Coinseed in February and secured a court ruling asking the platform to cease all activities. However, the platform would have continued its activities, and the operators would then have frozen customer withdrawals.
Worse yet, the platform reportedly erased some customer accounts, sparking new complaints even as the case was still pending in court.
“A judge has ruled in favor of our legal action to shut down the Coinseed app cryptocurrency trading platform and set up a permanent escrow to protect investor funds. Coinseed can no longer continue its fraudulent and illegal conduct which has defrauded millions from investors ”, said James via the official NYAG Twitter account.
The lawyer exchange platform has reportedly filed more than 100 complaints against the exchange platform, with most victims claiming to have lost thousands of dollars in recent months. In total, the exchange would have defrauded its customers of more than a million dollars in digital assets and deposits.
In addition to being asked to cease all activity, the Coinseed team was fined $ 3 million.
The exchange platform has also been sued by the United States Securities and Exchange Commission (SEC), which accuses it of operating illegally and deceiving investors.
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