Coinbase Fined €3.3 Million in the Netherlands, Exchange Considers Appeal – Exchanges

The Dutch central bank has fined crypto exchange Coinbase for providing services in the past without the required registration. The trading platform, which has until March to object to the measure, is currently considering an appeal against the move.

The Dutch Monetary Authority fines Coinbase for operating without registration

The Nederlandsche Bank ( DNB ) imposed an administrative penalty of €3,325,000 (over $3.6 million) on Coinbase Europe Limited on January 18, 2023. In an announcement, the penalty was explained by the exchange offering crypto services in the Netherlands in a past period without registering with the central bank.

This, according to the regulator, constitutes a non-compliance with Dutch regulations, as companies wishing to provide crypto-related services must register with the DNB under the Anti-Money Laundering and Terrorist Financing Act.

The monetary authority further stated that the base amount for this category of fines is 2 million euros, noting that in the case of Coinbase the fine was increased “due to the seriousness and degree of culpability of the non-compliance.”

"In increasing the fine, DNB took into account the fact that Coinbase is one of the largest crypto service providers worldwide. Furthermore, Coinbase has a significant number of customers in the Netherlands who use its crypto services," the bank said, noting that the exchange has not paid any regulatory fees.

The Dutch central bank also highlighted that Coinbase operated without registration for an extended period of time, between mid-November 2020 and the end of August 2022, emphasizing that it considers this a serious violation.

However, the DNB also reduced the fine by 5% as Coinbase had always intended to obtain registration in the Netherlands, which it did on September 22 last year. The registration requirement for crypto service providers was introduced in May 2020.

The lack of registration meant that the global exchange was unable to report any unusual transactions to the Dutch Financial Intelligence Unit during the said period and these transfers may have gone unnoticed by investigative authorities, the bank stressed.

Coinbase has until March 2, 2023 to object to the fine. The exchange was quoted by Reuters as saying that it disagreed with DNB's decision, which "does not contain any criticism of our actual services." The crypto company is now considering an appeal.

In July 2022, De Nederlandsche Bank imposed an identical measure against Binance. The world's largest crypto exchange was also there punished the same amount in euros for offering crypto services in the Netherlands without the required registration.

Do you think the Dutch Central Bank will fine other crypto service providers? Tell us in the comments section below.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens' quote: "Being a writer is what I am, not what I do." In addition to crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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