Uphold will hand over $5 million to customers it helped scam, an amount that amounts to more than five times what the company actually earned from the deal.
Leveling with real teeth
New York Attorney General Letitia James Announce The settlement came this week, closing the book on Uphold’s role in promoting CredEarn, the cryptocurrency savings product run by Cred, LLC and its CEO, Daniel Schatt.
From January 2019 through October 2020, Uphold offered CredEarn to users through its platform and mobile app, describing it as a safe place to save money and generate strong annual returns. What users are not told is how these returns are actually generated.
Creed was financing it through microloans to low-income video game players in China — borrowers who had no credit history and couldn’t access traditional banks. These details never made it into Uphold’s presentation to customers.
My office received more than $5 million from Uphold, a cryptocurrency platform, for misleading people and promoting a fraudulent investment scheme.
I will always work to ensure that bad actors who put people’s livelihoods at risk are held accountable.
– New York AG James (@NewYorkStateAG) April 29, 2026
An insurance claim that was not valid
the Misleading promotion He did not stop at ambiguous language. According to the District Attorney’s Office, Uphold told agents that Cred carried comprehensive insurance. This claim was false. There was no such insurance protecting retail investors from cryptocurrency losses in the industry at that time. Furthermore, Uphold operates without the need for broker or commodity trader registration.
The risks are for everyone. Cred began racking up losses from its lending practices in March 2020. Eight months later, the company filed for bankruptcy. Thousands of Hold on Customers around the world are left with nothing to show for their deposits.
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Under the terms of the settlement Affected users It will be paid directly from a $5 million fund. Uphold also owes $545,189 from Cred’s ongoing bankruptcy proceedings — and any money recovered from that process will be passed on to affected investors as well. Customers can expect an email notification when funds arrive in their accounts.
“Investors should be able to trust the industry advice they receive,” James said in a statement, adding that her office will continue to hold bad actors accountable who put client funds at risk.
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