Consumers Affected
1
Attorney General William Tong issued a consumer alert warning Connecticut residents about unregulated, offshore decentralized finance (DeFi) cryptocurrency exchanges, naming GMX, Gains Network, dYdX, Aevo, Drift Protocol, Vertex Protocol, and Hyperliquid. The alert highlights risks including bypassing U.S. law via VPNs, predatory leverage up to 250x, misleading synthetic asset products, and lack of KYC protections. No enforcement action or penalty was imposed; at least one Connecticut consumer reportedly lost $200,000 deposited with an unregulated DeFi exchange.
No enforcement remedies were imposed. The Attorney General issued a consumer alert advising consumers to verify a platform's U.S. regulatory registration before sending money, keep records of all transactions and communications, and report suspected scams to the Office of the Attorney General.
In-house legal teams engaging crypto, fintech, or digital asset service providers should review vendor onboarding and vendor management agreements to require representations that all counterparties are properly registered and regulated with applicable U.S. authorities (state banking/securities regulators, FinCEN, SEC/CFTC as applicable). Contracts should include KYC/AML and sanctions compliance clauses, warranties that the vendor does not operate through unregistered offshore entities or facilitate evasion of U.S. jurisdictional restrictions (e.g., via VPNs), and disclosure provisions regarding investor protections and the irreversibility of digital asset transactions. Treasury and investment policies permitting any use of digital asset platforms should be updated to prohibit transacting on unregulated DeFi exchanges, and customer-facing terms should include clear risk disclosures. No specific statutes were cited in this alert, but Connecticut's digital asset marketplace rules, including cryptocurrency ATM safeguards, signal heightened state scrutiny of crypto vendor relationships.
Entity
Hyperliquid
Industry
Financial Services"Attorney General William Tong today issued a comprehensive consumer alert warning Connecticut residents about the significant financial and security risks associated with unregulated, offshore "decentralized finance" (DeFi) cryptocurrency exchanges."
"09/03/2026"
"including GMX, Gains Network, dYdX, Aevo, Drift Protocol, Vertex Protocol, and Hyperliquid"
"bypass critical consumer protections and expose retail investors to substantial financial losses, predatory leverage, and serious security risks"
"The Office of the Attorney General is aware of at least one Connecticut consumer who was deceived into depositing $200,000 into an unregulated DeFi cryptocurrency exchange"
"approximately 22.6% of traffic to Hyperliquid, the world's largest perpetual contracts exchange, originates from the U.S."
Connecticut Attorney General William Tong joined a coalition of states and local governments in filing suit against NHTSA over its rule weakening fuel economy standards for new passenger cars and light trucks. The lawsuit alleges the rule violates the agency’s statutory mandate and the Administrative Procedure Act; no penalty or final remedy is reported.
Connecticut Attorney General William Tong joined a multistate coalition suing the EPA over its repeal of greenhouse gas pollution limits for power plants and separately filed a notice of intent to sue over regulation of existing gas plants. The coalition asks the court to overturn the repeal and restore the protections; the release reports no monetary penalty or final order.
$400.0M
Connecticut Attorney General William Tong announced a $400 million settlement with Sandoz Inc. and Fougera Pharmaceuticals Inc. resolving allegations that the generic drug manufacturers conspired to inflate prices, limit competition, and restrain trade. The settlement includes consumer restitution and injunctive reforms; court approval was being sought.
Connecticut Attorney General William Tong joined a coalition of 21 attorneys general in submitting a comment letter opposing a DHS rule that allows certain affirmative asylum applications to be referred to removal proceedings without an asylum officer interview. The coalition argues the rule violates federal law and harms asylum seekers, including unaccompanied children; this was a policy opposition letter, not a privacy enforcement action.
Connecticut and Massachusetts co-led a coalition protest urging FERC to reject the proposed NextEra Energy-Dominion Energy merger. The coalition argued that the merger could increase market power and threaten energy affordability, reliability, and competition; the release does not report a final enforcement decision or penalty.
Connecticut officials warned residents about potential home improvement scams before an approaching nor’easter, including unlicensed contractors, high-pressure sales tactics, and demands for full payment upfront. The release provides consumer guidance on checking contractors and contract requirements; it does not announce an enforcement action or penalty against a named entity.