On Monday, the largest crypto exchange in the world, Binance has slapped with a fine worth 3.3 million euros by the Dutch central bank. This was because the crypto exchange was illegally operating in the Netherlands.
De Nederlandsche Bank (DBS) had issued a warning to Binance back in August 2021, when it had first begun offering services in the country without any authorization. However, as it turns out, the crypto exchange did not pay heed to the warning, which resulted in the fine. This fine falls in category 3, which is the most stringent level of enforcement of the DBS.
The bank can impose a fine of between 2 million and 4 million euros maximum and Binance’s penalty falls in the upper limit of that range. DNB said that they had chosen to impose a hefty penalty because of the degree of culpability and the gravity of non-compliance.
According to the central bank, Binance had been carrying on with the breach for a substantial period of time. It had started offering its services without authorization back on May 21st, 2020 and had continued to do so until December 1st, 2021, at the very least. The regulatory authority said that this is what made the breach so grave.
DNB also disclosed that they had considered the size of the company into account, along with the extensive customer base that it has established in the country. According to statistics, Binance is the biggest crypto exchange globally, as its daily trading volume is close to $1.5 billion. On June 2nd, Binance filed an appeal against the penalty.
A spokesperson for Binance said that they are pursuing their license in the Netherlands and want to be able to put an end to the squabble as quickly as possible. The spokesperson asserted that the decision of the Dutch central bank was a shift in their ongoing collaboration.
The spokesperson asserted that even though they did not share the same perspective on the decision taken by DNB, they were respectful of the professionalism and authority of the regulators when it comes to imposing the rules they consider suitable.
This development does not help the recent shift in Binance’s tone because of its aim of establishing a peaceful rapport with global regulatory authorities. Previously, the crypto exchange had mostly operated outside the parameters of the law. As a matter of fact, Changpeng Zhao, the exchange’s chief executive had gone as far as boasting about not having any global headquarters in the company.
However, the company has shifted its stance and is now trying to get on the good side of regulators, instead of becoming their foe. This is particularly true in Europe, as Binance has already secured licenses in France, Italy, and Spain.
DBS reduced the fine against Binance by 5% because it had already applied for registration and the central bank said that the company had also been ‘relatively transparent’. It further said that they were still reviewing the company’s application.