Bitonic, a Netherlands-based bitcoin exchange company, announced that De Nederlandsche Bank NV (DNB), the country’s central bank, has recognized a recent objection raised by Bitonic regarding the so-called wallet verification requirement. Officially recognized by the regulator View from Bitonic that the submitted request was illegal and should never have been made during registration:
“After a renewed examination, the DNB comes to the conclusion that this interpretation of Article 2 Paragraph 2 RtSw given by the DNB does not adequately meet the discretion that an institution has to implement this standard in a risk-oriented manner. The DNB has therefore wrongly stipulated mandatory registration as a condition. for the registration of Bitonic. “
In other words, DNB admits Bitonic was right. It is the result of an order from the court that the Dutch supervisory authority should better motivate their registration decision. Essentially, the DNB decided to revoke the requirement set out in the registration decision.
“The DNB declares the objection to be well-founded and revokes its main decision of November 17, 2020, insofar as this relates to the interpretation of Article 2 Paragraph 2 of the RtSw with the registration obligation advocated by the DNB.”
This means that Bitonic will remove the wallet verification measures as soon as possible. For example, the exchange no longer requests a copy of your wallet screenshot for all transactions. The company is also continuing to investigate what other simplifications are possible.
The Bitonic team made the following statement:
We are pleased that this frees our customers from unlawful and onerous proceedings. At the same time, we fear that the regulator only reacted to the complaints from the industry after the court intervened. What if Bitonic hadn’t gone to court? We hope that politicians will think about it further. As a result of this situation, the entire Dutch crypto sector was confronted with excessive costs and administrative burdens. That is in spite of prior warning our industry in terms of risk and the Invasion of customer privacy weren’t right. Therefore, the process we went through has affected innovation and the business climate in the Netherlands. This is in stark contrast to the claim that the Netherlands promotes an innovative business climate. Further analysis and follow-up steps will follow as we further examine the formal decision. The result is, for the time being, a positive step for the Netherlands and the international community. It is now clear that crypto supervisors cannot inappropriately deny crypto companies access to markets based on regulations and a process with an imperfect legal basis.