The Dutch central bank has fined the European branch of crypto exchange Coinbase €3.3 million ($3.6 million) for failing to meet registration requirements before offering its services in the Netherlands.
The regulator said Coinbase had been operating while unregistered between November 15, 2020, and August 24, 2022. Coinbase did eventually obtain the correct registration on September 22, 2022, but in the meantime, the DNB said the firm had enjoyed a competitive advantage by not paying supervisory fees.
Companies looking to provide crypto services in the Netherlands have to register with DNB under the Anti-Money Laundering and Anti-Terrorist Financing Act.
A Coinbase spokesperson told Decrypt that the company disagreed with the DNB’s fine, saying it was “based on the time it took for Coinbase to obtain our registration in the Netherlands and includes no criticism of our actual services,” adding that the exchange "should not be penalized for playing by the rules and engaging in this process."
The penalty was increased from a base amount of $2.18 million due to the severity of the non-compliance, De Nederlandsche Bank (DNB) said in a statement.
The fine was also increased due to Coinbase’s size as one of the largest crypto exchanges in the world, as well as the number of customers it serves in the Netherlands. Per CoinGecko, Coinbase has hosted more than $2.3 billion in volume over the last day.
However, the total amount was then reduced by 5% in recognition that the company had always intended to complete registration.
The crypto exchange now has until March 2 to object to the fine. “While we respect DNB’s authority to enforce its regulations, we are carefully considering the objections and appeals process," the spokesperson said.
The Dutch regulator issued an identical fine to Binance last summer for offering its services in the Netherlands without a license.
Coinbase stock (COIN) is down 1.48% and is trading hands at $52.76.