• Coinbase recently received a $3.6 million fine from the Dutch Central Bank (DNB) for violations of Dutch crypto registration procedures.
• The fine is in line with one imposed on Binance last year and is justified by the gravity and scale of the violation.
• Coinbase argues it is being punished for cooperating with the regulations, but still has the option to appeal.

Coinbase, one of the world’s leading cryptocurrency exchanges, recently received a hefty fine from the Dutch Central Bank (DNB) for „very serious“ violations of Dutch crypto registration procedures. The DNB sanctioned Coinbase with a penalty of 3,325,000 euros ($3.6 million), which is in line with the fine imposed on rival crypto exchange Binance last year.

The DNB argues that the size of the fine is justified by the gravity and scale of the violation. Coinbase, who is now registered with the DNB, argues that it is being punished for cooperating with the regulations rather than deliberately disobeying them. Coinbase originally applied for registration to offer exchange and wallet services in September 2020, but withdrew the application the following month.

The incident is a stark reminder that as cryptocurrency and blockchain technology become more mainstream, there are still many regulatory obstacles to navigate. As regulatory authorities have begun to implement laws and regulations related to the industry, disputes over rules, procedures and jurisdiction are likely to arise. The relatively compliant may even end up bearing the brunt of regulators‘ wrath, as Coinbase has done in this case.

Despite the size of the fine, Coinbase still has the option to appeal. The fine may yet be reduced or overturned, depending on the outcome of the appeal. The incident serves as a warning to other cryptocurrency exchanges to be mindful of the regulations and procedures that govern the industry, and to ensure that they are in compliance with them.

The incident also highlights the need for regulatory authorities to continue to work with the cryptocurrency industry in order to ensure that the regulations are fair and effective. As the industry continues to grow and mature, it is important for both parties to come to an understanding that will benefit all involved.