BitFlyer USA, a cryptocurrency exchange, has been fined $1.2 million by the New York State Department of Financial Services (NYDFS) for failing to meet the state’s cybersecurity requirements, according to a statement released by the regulator on Wednesday.

The NYDFS stated that bitFlyer USA had failed to comply with the state’s cybersecurity regulation, despite holding a license to operate in New York.

This violation was discovered during an on-site examination conducted by the regulator in 2019, which revealed deficiencies in the exchange’s cybersecurity practices.

Despite the fine, the NYDFS acknowledged bitFlyer USA’s efforts to improve its cybersecurity posture. The exchange presented the regulator with a remediation plan, which outlines steps to ensure compliance with the state’s cybersecurity laws by the end of the year.

This incident highlights the growing importance of cybersecurity in the cryptocurrency industry, with regulators cracking down on companies that fail to meet established standards. BitFlyer USA is the latest in a series of crypto companies that have been fined by the NYDFS for various violations.

In January, Coinbase paid $50 million to settle charges that it let users open accounts without having conducted sufficient background checks.

Similarly, Robinhood’s crypto division paid $30 million last year for anti-money laundering and cybersecurity violations.

Cryptocurrency exchanges and other crypto-related businesses are expected to adhere to high cybersecurity standards to protect their users’ assets and personal information. Failure to do so not only puts customers at risk but also attracts regulatory scrutiny and potential fines.