Coinseed Ordered to Shut Down Following Lawsuit From New York Attorney General

The company was temporarily shut down in June via a preliminary injunction.

AccessTimeIconSep 13, 2021 at 9:25 p.m. UTC
Updated May 11, 2023 at 5:06 p.m. UTC

Crypto trading app Coinseed has been ordered shut down by the Supreme Court of the State of New York following a lawsuit from state Attorney General Letitia James.

  • James secured a court judgment on Sept. 9 against Coinseed, as well as the company’s CEO, Delgerdalai Davaasambuu, to permanently halt operations, put in place a permanent receiver to protect investors’ funds and take control of Coinseed’s website to prevent the possibility of future schemes.
  • The court also ordered a $3 million judgment against the defendants to be awarded to victims of Coinseed’s fraudulent conduct and operations as an unregistered commodities dealer.
  • The lawsuit, initially filed in February, accused Coinseed and its CEO of defrauding thousands of investors across the country out of millions of dollars by selling them an unregistered initial coin offering in 2018, as well as by charging hidden fees and making false claims.
  • The company was temporarily shut down in June via a preliminary injunction, but according to James, Coinseed continued to carry out illegal activities.
  • “In defiance of court orders, this company has continued to operate illegally and unethically, holding investors’ funds hostage and underscoring the dangers of investing in unregistered virtual currencies,” James said in a press release.
  • Coinseed Chief Financial Officer Sukhbat Lkhagvadorj didn’t immediately return a request for comment.


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Eli Tan

Eli was a news reporter for CoinDesk. He holds ETH, SOL and AVAX.