The New York Attorney General's Office (NY AG) announced on April 29, 2026, that Uphold HQ Inc. will pay more than $5 million to compensate customers affected by CredEarn, a third-party crypto investment product offered by Cred LLC. The settlement mandates customer repayment, improved product-review standards, broker registration, and the transfer of any recoveries from Cred's bankruptcy proceedings to harmed investors.
Risks Behind CredEarn
Uphold made CredEarn available through its platform and mobile app from January 2019 to October 2020. The product promised annual interest to customers who deposited cryptocurrency with Cred. However, an investigation by the NY AG found that Cred generated returns through risky lending activities: loans were extended to video game players in China with low monthly incomes, no credit histories, and no access to traditional Chinese credit. Uphold also claimed that Cred had 'comprehensive insurance,' but no coverage actually protected retail investors from digital asset investment losses. Attorney General Letitia James stated: 'Investors should be able to trust the industry advice they receive, and my office will always work to ensure bad actors are held accountable for endangering their customers’ financial security.'
Settlement Terms and Compliance Requirements
Under the settlement, Uphold must pay $5 million directly to customers who suffered losses — an amount more than five times the fees Uphold collected from the arrangement. Additionally, Uphold must transfer any recovery it receives from Cred's bankruptcy proceedings (currently $545,189) to affected customers. The company is also required to strengthen its due diligence policies before partnering with or recommending third-party investment products, and it must register as a broker with the Office of the Attorney General. James added: 'When crypto companies break the law and mislead investors, the consequences can be devastating to New Yorkers’ livelihoods.'
Broader Crypto Enforcement Landscape
The Uphold settlement fits into a broader NY AG enforcement record that has treated crypto as a financial market subject to investor protection rules. Using the Martin Act of 1921, the office has pursued financial fraud cases without needing to prove intent. Since 2014, its crypto-related actions have included inquiries into the 'shadow' market, the 2018 Virtual Markets Integrity Initiative, the 2019 Ifinex/Bitfinex/Tether case, the 2021 Coinseed shutdown, and lending platform actions such as BlockFi. Between 2023 and 2026, major cases involved Genesis Global, Gemini, DCG, Novatechfx, Galaxy Digital, and Uphold. In April 2026, the office also filed lawsuits against Coinbase and Gemini over prediction markets. These actions have secured more than $2.5 billion in restitution and penalties, pushing major firms to adjust compliance for New York market access. The Uphold resolution closes the matter with customer repayment, broker registration, and stronger review standards for third-party crypto investment offerings.