- KuCoin CEO announced that the exchange will be airdropping $10M in BTC and KCS
- FUD caused users to withdraw more than $1 billion from KuCoin
- Lyu stated that KuCoin stayed loyal to its motto the “People’s Exchange”
CEO of KuCoin Exchange Johnny Lyu announced that KuCoin will be air-dropping $10 Million worth of KCS and BTC. In Lyu’s words: “To express our profound gratitude for your support and patience, KuCoin will launch a special airdrop event totaling 10 million USD in KCS and BTC”
In particular, this announcement comes after KuCoin was slapped with allegations from both the U.S. Department of Justice (DOJ) and the Commodity Futures Trading Commission(CFTC).
With the allegation against KuCoin, fear, uncertainty, and doubt (FUD) took the better of many users and as a result, KuCoin saw around $1 billion in crypto being withdrawn, causing a 20% drop in assets under management.
Addressing the issue and thanking the loyal users, the CEO of KuCoin stated in a blog post on their official website:
I would like to express my gratitude to all KuCoin users, for your support, trust, and companionship during the past few days, as well as the past 7 years. We will absolutely ensure the security of user assets as always and comply with regulations to fulfill our trust.,
Reflecting on compensation that KuCoin made in the past, Lyu stated, “In the early days of October 2017, at the very early stage of KuCoin, we made the unprecedented decision in the industry to proactively acquire and compensate users in large amounts due to the abnormal delisting of the CFD project.”
He further stated that this act of proactive compensation marked the origin of the title of “People’s Exchange” – a testament to the community’s original affirmation of KuCoin. He mentioned that they have always treasured this rare trust, and being “People’s Exchange” was their proudest label.
However, airdrops have their own set of problems. One of these problems is the threat of regulatory consequences.
The SEC, in its “Framework for ‘Investment Contract’ Analysis of Digital Assets,” stated: Just because digital assets are received for free, for example, being put into an “airdrop,” does not mean the investment of money requirement of the Howey test is not met; therefore, an airdrop can be considered a sale or distribution of securities.
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