Cryptocurrencies

Netherlands: Foreign Crypto Firms Under Anti-Money Laundering Laws

September 11, 2019 at 3:37 AM | By Jit Sutradhar News

Cryptocurrency entities based outside the Netherlands can get started under new crypto regulations.

Following a CoinDesk report on the recent DNB registration mandate for cryptocurrency companies, DNB spokesman Tobias Oudejans said that current legislation before the Dutch House of Representatives will not only force national companies to register with the central bank, but foreign entities will also not be allowed to perform services within the country.

Foreign entities include all companies registered outside the European Economic Zone, a block that constitutes the majority of European countries.

When asked if foreign encryption companies would have to create offices within the Netherlands or Europe to gain access to the market, Oudejans made no comment.

Oudejans said the legislation, which addresses the fifth EU Directive against money laundering (AMLD 5), is still under consideration. However, the central bank has already asked all Dutch crypto companies to register before the January 10 deadline required by AMLD 5.

Legislation and central bank registration are based on concerns against money laundering. Like all financial companies, Oudejans said, encryption companies must register with the Dutch government. As a new industry, regulations are very standard, even if they look like draconians, he said.

Local encryption companies are happy with the regulation

The lack of clear regulation in the nascent Dutch crypto market is a problem that many Dutch crypto service providers are happy to address, says a local crypto company.

The founder of Crypto2Cash, PJ Datema, told CoinDesk that bad actors will not be able to meet DNB standards, which will help mature the market with its exit.

“It’s a really nice step. I don’t say they are adopting cryptography. [But] we’re finally moving forward after a long period of silence,” Datema said. “It is good that they are taking action. If we want the market to mature and for the participants to evolve … they want anti-money laundering (AML) and to know their client (KYC) properly,” he continued.

It has not yet been understood how international companies, or even other European ones, will operate under the encryption laws that are being drafted. Datema said the regulation is good for local companies and, according to its interpretation, has the potential to block competitors in Germany, France and elsewhere.

For now, there are many questions such as what the final legislation will look like, how the DNB will enforce it and how international players can operate within the Netherlands.

“With a parliament in Brussels, you would assume that you would apply a set of rules for Europe,” Datema concluded.

Dutch bitcoin image via Shutterstock

This article is republished from coindesk.com. If you have any questions, objection or any other matter you can contact us. Thank you for visiting our website.

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