The Dutch central bank has imposed a 3.325 million euro (CI$2.8 million) administrative fine on Binance for offering crypto services without the legally required registration.
Binance, which has a Cayman-based holding company, is the world’s largest crypto services provider.
Companies offering digital asset services in the Netherlands must register with the Dutch National Bank under the country’s anti-money laundering legislation.
“Today’s decision marks a long-awaited pivot in our ongoing collaboration with the Dutch Central Bank,” a Binance spokesperson told CNBC.
“While we do not share the same view on every aspect of the decision, we deeply respect the authority and professionalism of Dutch regulators to enforce regulations as they see fit,” the spokesperson said.
In determining the fine, the regulator said it had considered that Binance has a large number of customers in the Netherlands and a daily global trading volume of US$13.7 billion (CI$11.4 billion).
In addition, Binance had enjoyed a competitive advantage because the company had not paid any fees to DNB or incurred costs in connection with the ongoing supervision by the regulator.
The fine was, however, reduced by 5%, because Binance had now filed a registration application and the company had been transparent about its business operations, the central bank said.
The registration application is currently under review.
Binance has received licences to operate in other European countries, most recently in Spain, France and Italy.
The Dutch fine followed a public warning issued by the DNB regarding Binance in August 2021, as regulators in the UK, Japan and the Cayman Islands also said Binance was not allowed to operate in their respective jurisdictions.
Binance has a holding company incorporated in Cayman and entities around the world, but no clearly designated operational headquarters.
CIMA announced in July 2021 Binance Group and Binance Holdings Limited were not registered, licensed, regulated or otherwise authorised to operate a cryptocurrency exchange from or within the Cayman Islands.
According to the company, Binance’s Cayman-based entities were not related to operating crypto exchange trading activities.
CIMA said at the time it was investigating whether the company was carrying out activities that would fall under its regulatory oversight.
Cayman-registered companies that provide virtual-asset and custodian services locally or from the islands must be registered or licensed under the Virtual Asset (Service Providers) Act.
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