Companies in the fintech sector enjoy the benefits of offering digital services for their consumers. However, the Israel-based social trading and investment Etoro will reportedly stop offering all crypto services on its platform in the Netherlands. First reported by RTL Z, the company was unable to get its crypto services registered at De Nederlandsche Bank (DNB) in time, and thus, it will discontinue offering crypto services on its platform, in the Netherlands.
Forced to sell cryptocurrencies
Silicon Canals reached out to eToro to learn more about the current situation. In a media statement, it says, “eToro is in the process of registering as a crypto service provider with De Nederlandsche Bank NV (DNB). Until the application is decided upon, eToro will no longer be able to provide crypto services to users in the Netherlands. We apologise for the inconvenience that this will cause.” However, the unicorn assures that its non-crypto services will be offered as usual for its Dutch customers.
Etoro also told SC that no new crypto accounts will be opened from December 31 and their users’ existing crypto-trading accounts will be closed on January 23. This means the users will need to sell all the cryptocurrency in their account before the stated date, even if it means incurring a loss. Alternatively, they can also withdraw crypto assets from their eToro Wallet to any other digital wallet or blockchain address by 11:00 pm CET on January 23, 2021.
The initial report also states that a group of “duped crypto investors” is considering taking legal action against the company. Such groups are said to be uniting on the platform Etorosluitmijncrypto where they mention their severe disadvantage due to Etoro’s tussle with The Netherlands Bank.
The Netherlands has some strict regulations in place to protect consumers when it comes to trading cryptocurrencies. Back in 2019, DNB announced new rules for companies trading in crypto, which were said to be necessary for preventing money laundering. Back in May in 2020, the deadline for getting registered as a crypto services supplier expired and DNB has not commented whether Etoro was late in submitting its application.
The report quotes the crypto expert Madelon Vos, who says more crypto trading companies might soon stop their services in the Netherlands since they’ve not completed their registration with the DNB. As per Vos, 48 companies have applied for the registration while only 15 are currently registered.
Vos also comments that the Netherlands is stricter than other countries in terms of cryptocurrency trading. “The costs of the registration are also unclear. And you may wonder whether this registration, actually a license, must be done with DNB or the Financial Markets Authority.”
Based out of Israel, Etoro commenced its operations back in 2007. The company operates on a global scale, with over 12 million registered users on its platform. As per Dealroom’s information, the company is valued at a notable €2.3B and employees over 1400 people worldwide.