- Dutch cryptocurrency exchange bitonic has won an important lawsuit against the Dutch National Bank
- A Dutch court ruled that the DNB’s increased identity checks on crypto exchange users was illegal
- Bitonic complained that the new measures were “unlawful and onerous”
Bitonic, the Dutch Bitcoin exchange that took a stand against tough new crypto regulations in the country, has won its case against the De Nederlandsche Bank (DNB), the Dutch national bank. As part of the raft of tough new regulations aimed at de-anonymizing the Dutch cryptocurrency ecosystem, the DNB had called on all cryptocurrency exchanges like Bitonic to enforce more checks on users using crypto platforms, using measures that Bitonic called “ineffective and disproportionate”. On Thursday it was revealed that a Rotterdam District Court judge agreed with the exchange, saying that the additional measures went too far, providing a rare victory for privacy advocates, although this is likely just one battle in a much larger war.
1977 Sanction Act Extension Revoked
The court case began six months ago when the DNB announced that the 1977 Sanction Act would be extended to include cryptocurrency transactions. This meant that exchanges would be forced to get users to prove their identity before they were allowed to move cryptocurrency off the exchange, while also asking buyers why they wanted to buy cryptocurrency and where they plan to store it.
Bitonic was one of many exchanges understandably furious with the news rules and filed a lawsuit against the DNB in January, calling the new measures “ineffective and disproportionate” and stating that they lacked a “proper legal basis”. Their point of view was backed up by financial compliance Bökkerink Compliance International, and happily for them, and other cryptocurrency exchanges in the country, the judge agreed, stating that the new measures went too far.
DNB formally acknowledges complaints Bitonic and revokes wallet-verification requirementhttps://t.co/gEaE1P0mqo#bitcoin
— Bitonic (@Bitonic) May 20, 2021
Bitonic to Roll Back New Requirements
Following the verdict, the DNB admitted that its interpretation of the laws “does not do enough justice to the discretion that an institution has to implement this standard in a risk-oriented manner” and as a result it “incorrectly set the registration requirement as a condition for the registration of Bitonic.”
Bitonic immediately announced that it would stop the “unlawful and onerous procedure” of invasive user identification, although it noted concern over the fact that regulators only stepped in after they had raised the complaint.
With regulation of the cryptocurrency seemingly a growing priority in many countries, it likely won’t be long before another piece of similar legislation finds its way into the inboxes of Bitonic and its compatriots.