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Netherlands to Regulate Crypto Businesses from Jan. 10, 2020

De Nederlandsche Bank (DNB), the central bank of the Netherlands, announced Tuesday that it would begin regulating cryptocurrency-related companies from January 10, 2020.  

Firms such as crypto exchange and crypto wallet providers are expected to become subject to DNB integrity supervision by registering their services if at all, they must remain in business.

“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 announcement noted. 

Together with the Dutch Authority for the Financial Markets (AFM), the idea for “integrity supervision” of crypto-related business in the country from January is allegedly the vulnerability of cryptocurrencies to financial crime.

The Dutch central bank had warned against the integrity risks associated with digital currencies, adding that it was essential to set up the regulation now. 

Moving further, the regulation of these firms in the Netherlands will be conducted under the fifth European anti-money laundering directive (AMLD5) and its implementation in Dutch law, DNB noted.

During registration, board members and some shareholders (qualifying holdings) of any crypto business will be assessed to ensure their processes are expertly designed and managed to combat money laundering and terrorist financing.

Once a firm is successfully assessed and registered, the bank will monitor its activities to ensure it complies with the rules on money laundering and also to prevent terrorist financing, according to the report.

As per the European directive, “the duty to register must take effect no later than January 10, 2020. It could also apply from a later date, however, depending on the exact timing of the directive’s implementation into Dutch law.”

Hence, companies that provide or wish to provide these services ought to seek guidance from DNB about their integrity supervision. Failure to register will cause such firms to cease from operating crypto exchange and wallet services in the Netherlands.

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