Netherlands-based crypto exchanges are now required by law to get additional information from clients regarding their bitcoin addresses. As part of the new requirements, which went into effect on Nov. 17, clients must now furnish exchanges with reasons why they wish to buy bitcoin. They will also need to inform the exchange officials of the kind of wallet they use.
The new Dutch regulatory changes have gone into effect despite protestations by some of the countryâ€™s crypto exchanges. The Dutch Central Bank (DNB), which is enforcing the new regulations, wants crypto service providers to adhere to the provisions of the countryâ€™s Sanction Act 1977 just like other â€œsupervised institutions.â€
Meanwhile, Bitonic, the Netherland-based crypto exchange that opposes the new requirements, wants clients to support their stance. To do this, the exchange is asking clients â€œto formally object to these additional measures and the registration of this data.â€ The Bitonic team says they will soon â€œrelease a custom form intended specifically for this purpose.â€
Still, in a statement made via the exchangeâ€™s blog, the Bitonic team says it will reluctantly comply with the ineffective measure. The statement adds:
Furthermore, the statement informs clients of an additional requirement obliging the exchange to verify if the â€œlegitimate owner of the given bitcoin addressâ€ is actually in control of it. To perform this verification procedure, clients will be requested to â€œupload a screenshot from your wallet, or by signing a message.â€
According to the Netherlandsâ€™ Sanctions Act 1977, a crypto service provider â€œmust check whether their clients and any ultimate beneficiary owners (UBOs) are on a Dutch or European sanctions list and report any hits to DNB.â€ Under Dutch and EU sanction rules, no funds may be made available to individuals or entities that are on a sanctions list.
Organizations that fail to comply with the new provisions will be punished under the Economic Offences Act.
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