De Nederlandsche Bank (DNB), announced on Thursday, January 26, that it has imposed an administrative fine of €3,325,000 on Coinbase Europe Limited (Coinbase).
DNB says the fine was imposed since the US-based crypto exchange platform provided crypto services in the Netherlands in the past without registration with DNB, which is in non-compliance with the law.
The fine was imposed on January 18.
“Companies wishing to provide crypto services in the Netherlands are required to register with DNB under the Dutch Anti-Money Laundering and Anti-Terrorist Financing Act,” says DNB.
In April 2020, a law was passed under which crypto service providers are subject to the integrity supervision of De Nederlandsche Bank. Consequently, every crypto service provider was given a timeline before May 21, 2020, to apply for registration.
In addition to registering, the Implementation Act amending the Fourth Anti-Money Laundering Directive requires crypto service providers to comply with the Anti-Money Laundering and Anti-Terrorist Financing Act and the Sanctions Act.
Fine under category 3
According to DNB, Coinbase’s non-compliance with the guidelines is punishable by a category 3 fine.
DNB explains the base amount in this fine category is €2M, with a minimum amount of €0 and a maximum amount of €4M. Therefore, DNB applied its General fine calculation policy to set the amount of the administrative fine.
“The base amount has been increased due to the severity and degree of culpability of the non-compliance,” says DNB.
However, DNB reduced the fine by 5 per cent since Coinbase had always intended to obtain registration with DNB, claims the Dutch bank.
Coinbase obtained its registration on September 22, 2022.
This is not the first time DNB has imposed a fine on a crypto exchange. In July 2022, DNB imposed a fine of €3.3M on Binance, the world’s largest cryptocurrency exchange, for offering crypto services in the Netherlands without a legal registration with DNB.
Coinbase: What you need to know
Founded in 2012 by Brian Armstrong and Fred Ehrsam, Coinbase allows users to create their wallets and start buying or selling bitcoins by connecting with their bank accounts.
It also provides a series of merchant payment processing systems and tools that support many high-traffic websites on the internet.
Approximately 98 million verified users, 13,000 institutions, and 230,000 ecosystem partners in over 100 countries use Coinbase to invest, spend, save, earn, and use crypto.