The De Nederlandsche Bank (DNB), the central bank of the Netherlands, has imposed a significant fine on the cryptocurrency exchange platform Crypto.com. The punitive measure, amounting to 2.85 million euros, was applied due to Crypto.com’s operations without a mandatory registration from May 2020 to November 2022. The fine was originally levied in October but has only recently been disclosed to the public, with no explanation for the timing or the reason for the delay in announcement.
Crypto.com Faces Regulatory Repercussions
Crypto.com, operating under Foris DAX MT, was found to have provided crypto services in the Netherlands without fulfilling the registration requirements outlined by DNB on May 21, 2020. These regulations were enforced under the Dutch Anti-Money Laundering and Anti-Terrorist Financing Act. The base fine for such an infringement was set at 2 million euros but was increased taking into account the severity and the company’s accountability in the infringement.
The unregistered operation allowed Crypto.com to evade regulatory fees and compliance costs, granting it an unfair edge over its competitors. During this period, Crypto.com serviced a vast customer base which, due to its non-compliance, could not report suspicious transactions to the Financial Intelligence Unit. Following the imposition of the fine, the Crypto.com team lodged an appeal on October 9.
Registration and Compliance in the Dutch Crypto Space
It wasn’t until July 2023 that Crypto.com officially achieved registration status in the Netherlands. At that time, DNB acknowledged that while the platform’s previous operations were considered illegal, Dutch citizens were still within their rights to use the service. On March 13, a representative from Crypto.com stated that the fine pertained to a resolved issue and didn’t impact their current operations, emphasizing that the concerns raised were addressed promptly and transparently.
In a broader context, DNB has been active in regulating the cryptocurrency market, having implemented registration requirements in April 2022. Binance, another major cryptocurrency exchange, faced a similar fine of 3.3 million euros for operating without registration. After a failed attempt to register, Binance ceased its operations in the Netherlands in June 2022. At present, the country hosts 41 registered cryptocurrency service providers.