New York state has taken legal action against Coinbase Financial Markets and Gemini Titan, accusing the crypto platforms of violating state executive and administrative laws, according to newly filed court records. The lawsuits add to an already dense web of regulatory and enforcement actions targeting the two exchanges.
New suits target state-level violations
Reported by MarketScreener, the complaints focus on breaches of state law rather than federal securities rules. Both companies were already grappling with overlapping legal fronts: Coinbase faces a 2023 SEC civil suit over alleged unregistered securities trading, while Gemini reached a $50 million settlement with New York Attorney General Letitia James over its Earn product and was banned from running crypto lending programs in the state.
Although full details of the new complaints are not yet public, legal analysts say the cases reflect a broader trend of state watchdogs using executive and administrative law to police crypto activity — especially when federal enforcement is perceived as slow or fragmented.
Exchange hangover: old cases stacked with new
Coinbase is under mounting legal pressure from multiple directions. A recent derivative action accused senior executives of neglecting compliance duties after the exchange's 2021 listing. That shareholder case cited a prior $100 million settlement with the New York State Department of Financial Services over AML deficiencies, and a separate $5 million penalty from New Jersey securities regulators, to argue that management failed to curb “foreseeable regulatory risk”.
New York has also tangled repeatedly with Gemini. Attorney General Letitia James secured a $50 million recovery for Earn customers in 2024 and banned the firm from crypto lending after finding it misled investors on counterparty risk at Genesis.
Earlier this year, a separate New York lawsuit alleged Coinbase helped enable years of illegal online gambling by a minor through crypto transactions tied to offshore casino Stake.com, highlighting how state authorities are increasingly treating exchanges as gatekeepers in adjacent risk domains.
The fresh actions now ensure that legal and compliance overhangs will remain central to how investors, counterparties and policymakers assess both firms’ roles in the U.S. crypto market.