• Coinbase was recently sanctioned by the Dutch central bank for providing cryptocurrency services to Dutch users without duly registering.
• The fine was originally set at $2.18 million, but was increased to $3.62 million due to the seriousness of the noncompliance.
• Coinbase has until March 2 to file an appeal, and the fine will not significantly impact the exchange’s operations.
Coinbase, one of the largest and most popular cryptocurrency exchanges, was recently sanctioned by the Dutch central bank (DNB) for failing to register with appropriate authorities. According to Dutch legislation, all crypto service providers are required to register in order to combat money laundering and the financing of terrorism. The penalty, initially set at $2.18 million, was increased to $3.62 million, or 3,325,000 euros, due to the seriousness of the noncompliance and the number of users Coinbase has in the Netherlands. The exchange was also listed as one of the creditors of FTX in the latest court filings.
The DNB stated that Coinbase had gained an unfair competitive advantage due to its failure to pay supervisory costs until September 22, 2022, when the company finally registered properly. The fine, however, was decreased by 5% because it was understood that the company’s ultimate goal was to become registered. Coinbase has until March 2 to file an appeal, and it is not expected that the fine will significantly affect the exchange’s operations.
Following the FTX collapse, Coinbase rose to take over as the second-largest cryptocurrency exchange behind Binance. The exchange has been attempting to broaden its user base and services, but this recent sanction has cast a shadow on its efforts. While this new information is not reason enough to start spreading FUD about the exchange, it remains to be seen if the appeal will be successful and if Coinbase will be able to continue its operations without further penalties.