Financial supervisors want license system for trade in cryptocurrencies

Jan

20

2019

In an advisory report to Minister Hoekstra of Finance, the Dutch Bank and the AFM state that a license system for the trade in crypto coins must be introduced in the Netherlands. With this, anonymity has to disappear, and with it certain forms of crime.

The two Dutch authorities that supervise the financial system and the financial products offered state that a ‘national licensing system for crypto-exchange platforms and providers of crypto-vouchers should come’. According to both regulators, this is necessary to combat money laundering and the financing of terrorism more effectively.

According to the two authorities, a permit system makes it possible to ‘test parties at the gate and, if necessary, exclude them from the market beforehand’. The permit system must become part of the existing Anti-Money Laundering and Terrorist Financing Act. This Dutch law implements the fourth anti-money laundering directive from the EU; if the permit system comes, this means that the rules of this EU directive will also apply to cryptocurrency traders and wallet providers.

The AFM and DNB also advocated appropriate European regulations so that ‘small-scale business activities’ become possible. For example, crypto coins that represent ‘clear and enforceable rights, such as a share or bond’. The supervisors believe that blockchain technology can make this possible in the long term and they therefore want less strict rules not to obstruct blockchain technology unnecessarily.

Earlier, the Ministry of Finance already came up with a bill to implement the amendment of the fourth anti-money laundering directive. This bill states that providers of services with cryptocurrency must obtain a permit for this.

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