Binance was penalized more than three million euros by the Dutch central bank for providing services without having the appropriate registration, which is a blow to the cryptocurrency industry’s efforts to win over European regulators.
Dutch Central Bank Passed Down Fine To Binance In April 2022
According to the central bank, which mandates that businesses dealing in digital assets register before offering services in the Netherlands, the largest cryptocurrency trading platform in the world violated the rules. The rules state that companies must register before providing services in the Netherlands.
According to the bank, the administrative fee levied on Binance enhanced the seriousness of the infringement committed by Dutch rules. According to the statement made by the financial institution, the sector had violated the extended regulations period before May 2020. It had obtained a “competitive advantage” due to avoiding the expenses and fees associated with compliance.
The complaint from the Dutch watchdog sheds light on a developing schism between the perspectives of European monetary authorities on the topic of trade. Binance has come under fire from a variety of regulatory bodies all over the world because the exchange’s policies pose challenges in terms of preventing the laundering of illicit funds, protecting customers, and operating without a license.
Binance Penalized By Dutch Central Bank, Dealing A Blow To The European Push Of The Exchange
In June of 2021, the Financial Conduct Authority in the United Kingdom issued a client warning on the cryptocurrency exchange Binance. The FCA has been outspoken about the dangers of the burgeoning cryptocurrency market. The Financial Conduct Authority (FCA) stated in a statement that it did not believe that Binance could be adequately supervised due to the “substantial danger to consumers” posed by the “complex and high-risk financial products” offered by the company.
On the other hand, France, Spain, and Italy have only recently opened their commercial activity markets. A member of the European Parliament from France named Aurore Lalucq voiced her disagreement with the decision made by France’s Autorité des Marchés Financiers, describing the verdict as “incomprehensible.”
- According to Lalucq, the decision made by France is “surprising and even frightening.” It is especially true when one considers that many other supervisors, including some of the most important ones, have already refused to grant Binance any registration or permission.
- According to Binance, the regulatory reprimand issued in the Netherlands represents a “long-awaited shift in their continuing partnership with the Dutch central bank.”
Fine Came As A Result Of Exchange’s Failure To Register As Crypto Service Provider
In August of last year, the Dutch central bank issued a general caution against Binance after expressing concerns about the transaction and issuing a warning against the exchange. At the time, the financial institution said that Binance was providing cryptocurrency services in the Netherlands without obtaining the appropriate legal registration. It raised the danger of consumers “becoming involved in money laundering or terrorist financing.”
Binance has committed to establishing an appropriate headquarters and formalizing its organizational structure shortly. Before this, the company had been functioning as a “decentralized” organization for some years. The promise to alter is a concession given to the regulators, whose inquiry had been dragged down by the unorthodox structure of the business.
The company has also said that to bolster its regulatory credentials, it has rapidly boosted the hiring of compliance professionals and enforcement activities. It was done to improve its regulatory credentials.