In an attempt to prevent money laundering and terrorist financing, financial authorities in the Netherlands, CoinDesk says, are planning a licensing scheme for Dutch cryptocurrency exchanges and wallet service providers. This licensing system will force exchanges and wallet providers to closely monitor their users’ transactions and report any suspicious activity to the authorities.
The AFM And DNL Work Together On National Cryptocurrency Licensing
The Netherlands Authority for the Financial Markets (AFM) and the De Nederlandsche Bank (DNL) together made recommendations which were forwarded to the House of Representatives. In the report, they state: “A national licensing regime for crypto exchange platforms and crypto wallet providers is needed to ensure more effective prevention of money laundering and terrorist financing. The European regulatory framework for corporate funding must be amended to enable blockchain-based development of small-scale corporate funding. Effective protection of Dutch consumers against the principal risks requires international coordination due to the cross-border nature of cryptos”.
The AFM and DNL have repeatedly warned about the risks of deception, crime and fraud associated with cryptos and initial coin offerings (ICOs). Considering that the Dutch influence in the crypto world is relatively minimal, they are calling for international crypto rules to be established.
“The evolution of cryptos is primarily internationally-oriented given their inherent cross-border nature, and cannot be confined to the Dutch market alone,” the report states.
Dutch Crypto Community Worried
However, there are some members of the Dutch crypto community who are worried that the proposed regulations on Dutch cryptocurrency exchanges could destroy start-ups before they can establish themselves. Some are concerned that being required to keep records of customer data which can be accessed upon request by authorities will cost so much to set up that it won’t be a viable industry for them.
In August of 2018, DNL issued a statement on cryptocurrency saying that while it was not illegal it was “not money” However, perhaps they are more influential than they think, the Dutch city of Arnheim was the first in the world in terms of Bitcoin-accepting businesses to population members. For every million people there were 479 Bitcoin-accepting businesses.