Coinbase was hit with a $3.6 million fine by the Dutch central bank for failure to properly register in the country
By Morgan Chittum,
Coinbase is being fined $3.6 million for failing to register its crypto services to customers in the Netherlands, the Dutch central bank (DNB) said on Thursday.
DNB says that the company should have obtained the correct registration under the Dutch Anti-Money Laundering and Anti-Terrorist Financing Act before operating in the country.
The price of the fine was also higher than usual "due to the severity and degree of culpability of the non-compliance," the bank said in a statement, adding that they "took into account the fact that Coinbase is one of the largest crypto service providers" and has "a significant number of customers in the Netherlands."
The bank added: "In addition, Coinbase has enjoyed a competitive advantage in that it has not paid any supervisory fees to DNB or incurred other costs in connection with DNB's regular supervision activities."
However, DNB says it reduced the fine by 5% because Coinbase had always intended to obtain registration. The crypto giant has until March 2 to appeal the fine.
DNB says that Coinbase's non-compliance persisted over a period of time from "at least" November 2020 until August of 2022. The company later obtained a registration in September of last year.
Coinbase refutes the bank's claims, adding that the company is "carefully considering the objections and appeals process" for the fine.
"Coinbase disagrees with DNB's enforcement order, which is based on the time it took for Coinbase to obtain our registration in the Netherlands and includes no criticism of our actual services," a company spokesperson told Insider.
The spokesperson added: "We have engaged extensively with DNB and are proud to be the first major global crypto exchange to successfully register with them as a Crypto Service Provider. We should not be penalized for playing by the rules and engaging in this process."
DNB also hit Coinbase competitor and world's largest crypto exchange Binance with a $3.35 million fine in July.
"Another crypto giant being hit with fines from regulators won't help the market's 'wild west' reputation," Fergal Parkinson, Director of research intelligence firm TMT Analysis, told Insider in a statement. "Concerns over regulation and security appear to be the major factors preventing potential investors from fully embracing crypto - changing consumer perceptions is the single biggest barrier to crypto mass adoption."
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