$3.6M Fined imposed on Coinbase in the Netherlands
- The Dutch central bank fined US-based crypto exchange Coinbase $3.6 million for not registering.
- Authorities asserted that Coinbase violated regulations from November 2020 to August 2022.
The Dutch central bank imposed a 3.3 million euros ($3.6 million) charge on the European division of cryptocurrency exchange Coinbase. Failure to meet the state regulations before offering its services in the Netherlands led to penalties.
According to the regulatory body, Coinbase operated illegally from November 15, 2020, and August 24, 2022. Coinbase did finally receive the proper registration on September 22, 2022, but in the meanwhile, the DNB said the company had benefited from a competitive advantage by forgoing supervisory expenses.
Businesses in the Netherlands looking for cryptocurrency services must register with DNB in accordance with the Anti-Money Laundering and Anti-Terrorist Financing Act. A representative of Coinbase said:
“Based on the time it took for Coinbase to obtain our registration in the Netherlands and includes no criticism of our actual services. Coinbase is committed to compliance in all jurisdictions in which it operates and will continue to provide safe, trusted services to new and existing Dutch customers.”
The penalty was escalated from a base amount of $2.18 million due to how significant the non-compliance was, according to a release from De Nederlandsche Bank (DNB).
The scale of Coinbase as one of the biggest cryptocurrency exchanges in the world and the volume of Dutch consumers it serves contributed to the fine’s rise. According to CoinGecko, Coinbase hosted more than $2.3 billion in volume the day before.
The cost was later decreased by 5% to reflect the fact that the firm had always intended to finish registration.
The cryptocurrency exchange now has until March 2 to protest the fine expressly. “While we respect DNB’s authority to enforce its regulations, we are carefully considering the objections and appeals process,” the spokesperson added.
On January 10, Coinbase said that operational reorganization would result in a 20% reduction in staff. On this same day, the brother of the former manager of the cryptocurrency exchange received a 10-month prison term for insider trading, marking the first recorded instance of its sort in the sector.
Binance received a similar penalty from the Dutch authority last summer for providing its services without a license. This was done after they were found to be operating without proper authorization.