The Dutch central bank has announced that the regulation of crypto firms in the country will begin from January 2020, become the latest jurisdiction to introduce concrete plans for crypto regulation.
According to a statement from De Nederlandsche Bank, crypto firms will be obliged to register with the bank from early next year, in order to remain within the law. Firms that fail to register as required will no longer be able to trade, according to a bank spokesperson.
The new regulations will expand across different sectors of the crypto industry, and will include the likes of wallet providers, as well as crypto exchanges of various kinds.
In the statement, the bank said firms would be expected to register as soon as possible under the new regime:
In concrete terms, firms offering services for the exchange between cryptos and regular money, and crypto wallet providers, must register with De Nederlandsche Bank.
The news will be welcomed by the crypto industry in the Netherlands, after widespread calls for greater regulation for firms operating in cryptocurrency sectors, Reuters reported. However, it is likely that the new compliance requirements will cause difficulties for some currently unregulated firms, and commentators expect the new regime to raise standards across the sector.
It comes at a time of a wider trend towards regulation worldwide, with central banks and financial regulators keen to get a better grip of their domestic cryptocurrency sectors.
Especially given the high volume of scams and crypto criminality, greater regulation is seen as a necessary prerequisite to global mainstream crypto usage.
In particular, the central bank said it would be focusing on how firms comply with rules on terrorist financing and money laundering, in compliance with EU regulations.
“Cryptos are vulnerable to financial crime, which is why it is important to set up integrity supervision now. Once a firm is registered and we have assessed board members and other policymakers, we will monitor that it complies with the rules on money laundering and terrorist financing. Firms that do not register will no longer be allowed to provide crypto exchange services and wallets,” according to the Dutch central bank.
The developments will no doubt be monitored closely by regulators elsewhere, with countless other poised to introduce their own structures for greater regulation of crypto.
New to Bitcoin? Check out CoinGeek’s Bitcoin for Beginners section, the ultimate resource guide to learn more about Bitcoin—as originally envisioned by Satoshi Nakamoto—and blockchain.