Binance fined €3.3 million by Dutch central bank

Binance failed to comply with Dutch anti-money laundering and anti-terrorist financing laws, De Nederlandsche Bank said. As a result, the largest crypto exchange in the world owes the Dutch central bank €3.3 million.

Binance was fined €3.3 million by the Dutch central bank, De Nederlandsche Bank (DNB), for operating in the Netherlands without an appropriate license, the DNB announced on Monday. In August last year, the bank warned consumers that Binance was not approved as a trading platform by the Dutch authorities, and therefore “not in compliance with the Anti-Money Laundering and Anti-Terrorist Financing Act.”

The DNB said in a statement that the fine was imposed in April. An investigation into Binance’s operations in the Netherlands, which ran from May 2020 to December 2021, qualified the exchange's regulatory shortcomings as subject to a fine from the third category. The basic amount of third-category fine in the Netherlands is €2 million.

In the case of Binance, the penalty rose to €3.3 million, just €700,000 short of the maximum amount, on account of the “increased seriousness” and long duration of the violations. The DNB also stated that Binance served a large number of customers in the Netherlands, enjoying a competitive advantage as it has not paid levies to the DNB or covered the costs of ongoing supervision by the central bank.

On the other hand, the DNB lowered the fine it imposed on Binance, noting that the company has now applied for the necessary registration and “has been relatively transparent about its business operations throughout the process.” To reward these efforts, the Dutch central bank slashed the initial fine by 5%.

The ruling dealt a heavy blow to Binance after a happy string of months that saw the world’s biggest exchange widen its reach and placate regulators in various jurisdictions, including France, Bahrain, the UAE, and Puerto Rico.

Binance objected to the fine imposed by the DNB on June 2, but as the bank published the press release in mid-July, it’s unlikely the objection will be successful. Over the past two weeks, Binance was celebrating its fifth anniversary, with the main event located in another corner of the EU, Paris, where the company is setting up its new headquarters.