The Dutch Central Bank (DNB) has reportedly taken an action against one of the largest cryptocurrency exchanges (Coinbase).
The reports are coming in that the DNB has imposed a huge fine over the cryptocurrency exchange that is well worth over $3 million.
According to the sources, the fine has been imposed as the exchange has failed to comply with local regulations.
DNB Fines $3.6 Million to Coinbase
The report came in on January 26, revealing that the Dutch Central Bank has imposed a $3.6 million (3.3 million euros) fine on the Coinbase exchange.
As per the regulatory authority, the Coinbase exchange is expected to be compliant with local regulations while it operates as a financial services provider.
It has to abide by the same regulations and policies as other financial services providers (FSPs) in the country.
However, the exchange failed to meet the regulations and thus, they have imposed a huge fine on the exchange for non-compliance.
Coinbase Failed to Register
As per the legal requirements, any financial service provider needs to get registered before it can offer financial services in the Netherlands.
They have to have it on them otherwise, their operations are considered illegal. The Coinbase exchange fell in the same category as it failed to get itself registered in the Netherlands.
Instead, it began offering financial services to local investors in the country, which is punishable by law. This is exactly what they did by imposing a huge fine on the exchange so it fixes the problem right away.
The DNB officials made it clear that they went through the entire history and operational access of the exchange in the Netherlands before taking action.
They considered the operations and financial services offered by the exchange in the country. They also considered the number of consumers the exchange has in the Netherlands, which is a large figure.
After assessing everything, they came up with the decision of imposing a €3.3 million fine on the exchange.
They further clarified that they checked the operations of the exchange in the country from November 2020 until August 2022.
They established that throughout this period, the exchange has continued operating as an unregistered financial service provider in the Netherlands.
Other Exchanges Came Under Fire As well
Coinbase is not the only international cryptocurrency exchange that became prey to the wrath of the DNB. Other major cryptocurrency exchanges have also incurred huge fines from the DNB.
Another major name in the crypto world is KuCoin, a crypto exchange that is operating internationally and it had to pay a huge fine as well.
The DNB had alleged that the particular exchange was not operating in their jurisdiction with a proper license. Instead, it was offering unlicensed services to the locals in the country.
It was in August 2022 when KuCoin ended up facing a fine from the Dutch Central Bank.
The story does not end here because the DNB went after Binance Holdings Limited back in the year 2021 over the same concerns.
It was all over the news that the DNB had fined Binance with a fine that was also above the €3 million limit. It was back in 2021 and the exchange was filed for violations of the regulations in the country.
Things Not Looking Good for Coinbase
As the year 2023 began, positive things started to happen for the cryptocurrency industry. However, it seems that Coinbase is under some kind of an evil spell or a bad omen its situation is still quite traumatic.
The exchange has been facing one problem after another and it is mainly pertaining to its business operations.
In early January, the exchange announced that it had to cut down 20% of its overall workforce.
It also faced a lot of backlash from the crypto market and the regulators for having an ex-manager who was involved in insider trading. As a result, the person was jailed for 10 months, bringing the heat for the exchange.
On January 18, the exchange announced that it could not see business building up in Japan. Therefore, it was forced to make a decision and withdraw from the Japanese crypto market.