The Dutch central bank has imposed a fine on crypto exchange Coinbase for providing services in the past without the necessary registration. The trading platform, which has until March to object to the measure, is currently considering an appeal against the move.
Dutch Monetary Authority Fines Coinbase for Operating Without Registration
De Nederlandsche Bank (DNB) has imposed an administrative fine of €3,325,000 (over $3.6 million) on Coinbase Europe Limited, on Jan. 18, 2023. An announcement explained the penalty with the exchange offering crypto services in the Netherlands in a past period without registering with the central bank.
That, according to the regulator, constitutes non-compliance with Dutch rules as companies that want to provide crypto-related services are required to register with the DNB under the country’s Anti-Money Laundering and Anti-Terrorist Financing Act.
The monetary authority further detailed that the base amount for this category of fines is €2 million while pointing out that the fine in case with Coinbase has been increased “due to the severity 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 globally. Moreover, Coinbase has a significant number of customers in the Netherlands that make use of its crypto services,” the bank said and noted the exchange hasn’t paid any supervisory fees.
The Dutch central bank also highlighted that Coinbase operated without registration for a prolonged period of time, between mid-November, 2020 and late August, 2022, emphasizing it considers that a severe non-compliance.
However, the DNB also reduced the fine by 5% as it said Coinbase had always intended to obtain registration in the Netherlands, which it did on Sept. 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 unusual transactions to the Dutch Financial Intelligence Unit during the said period and these transfers may have gone unnoticed by the investigative authorities, the bank insisted.
Coinbase will be able to object to the fine until March 2, 2023. The exchange was quoted by Reuters as stating it disagreed with the decision of the DNB, which it said “includes no 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 fined the same amount in euros for offering crypto services in the Netherlands without the required registration.
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