Dutch’s DNB introduces additional Bitcoin Verification measures

The Dutch Central bank (DNB) now injects additional bitcoin verification measures on crypto exchanges. It is applying the Sanction Act.

By · Nov 19, 2020 . 5min read

Dutch Central bank Bitcoin regulation news

The Dutch Central Bank (DNB) has inflicted new restrictions on cryptocurrency exchanges with an additional verification measure concerning bitcoin addresses in reference to the Sanction Act. Bitonic, a Netherlands-based Bitcoin (BTC) exchange, has notified its users that they now require to comply with a new verification measure to continue utilizing its services. The Dutch Central Bank (DNB) requires additional verification protocols for crypto exchange users depending on the kind of wallet they use. 

According to a press release by Dutch crypto exchange Bitonic, there are expectations from Dutch exchanges to demand additional details. It includes the purpose with which a user expects to buy bitcoin and what sort of wallet used in the process. The exchanges are also bound to confirm if a user is the rightful owner of the provided bitcoin address by demanding to upload a screenshot from the wallet, or by signing a message.

Bitonic labels the new Bitcoin verification law as a nuisance.

Per the policy, Bitonic, the crypto exchange called the law a nuisance for its consumers. The platform also announced that it was protesting against the law. Thus, prompting disappointed users to express their disapproval through a complaint form on their website. The exchange conveyed that its application had zero effect on the Central bank.

Moreover, the Netherlands seems to have a non-friendly or stringent approach to Bitcoin regulation. Dutch Bitcoin companies faced millions in unnecessary fees earlier this year. The fees were implied owing to the Ministry of Finance delegating the Central bank to control activity in the state crypto industry. The high costs have made it challenging for Dutch Bitcoin companies to operate the business. Moreover, the measures were superfluous compared to those in other EU countries. Owing to the rising cost of compliance, platforms such as Deribit have terminated their operations and exited the country previously.

In May 2020, the Netherlands-based cryptocurrency exchange BitKassa determined to terminate its services. The decision was owing to the unreasonable demands of the DNB. The exchange stated that the Dutch Ministry of Finance did a great job in assisting the DNB. It assisted in implementing extreme regulations upon Dutch Bitcoin companies.

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