Gemini has decided to halt its services in the Netherlands due to crypto regulation changes. Users received an email notification today, announcing that the exchange will stop providing its services starting from November 17, 2023. This move is a direct response to the new regulations enforced by the De Nederlandsche Bank (DNB), which is the central bank of the Netherlands. Notably, this development follows earlier operational interruptions faced by cryptocurrency platforms operating in the country, including Binance earlier this year.
However, it’s important to note that Gemini is not completely severing its connection with the Dutch market. The email clarified that the company intends to comply with the Markets in Crypto-Assets Regulation (MiCa), a set of cryptocurrency regulations established within the European Union (EU).
Once Gemini achieves compliance with MiCa, they plan to resume their operations in the Netherlands. In the email, Gemini expressed its commitment to cooperating with regulators worldwide.
For Dutch users of Gemini, the immediate concern is the secure transition of their fiat and cryptocurrency assets. The exchange has recommended that users transfer their assets to Bitvavo, a local exchange registered with the DNB. Gemini also pledged to waive any trading fees associated with the withdrawal or transfer of assets, aiming to make the transition as smooth as possible for its users.
This development closely follows Binance’s departure from the Netherlands in July 2023. Binance was unable to obtain a virtual asset service provider (VASP) license from the DNB, which certifies compliance with anti-money laundering (AML) guidelines. Consequently, Dutch residents were limited to withdrawing their funds from Binance, according to the exchange’s statement.
Gemini’s decision is part of a broader trend reflecting the tightening of crypto regulations in the Netherlands and the entire EU. The DNB’s actions align with efforts to harmonize crypto regulations across EU member states as outlined in MiCa. The exit of two major exchanges in such a short span highlights the stringent enforcement of these regulations, affecting both the platforms and their user bases.
Gemini’s temporary withdrawal from the Netherlands could potentially set a precedent for how crypto regulations shape the industry in other EU countries. As MiCa regulations take effect, other exchanges may encounter similar challenges in achieving compliance, potentially prompting a reassessment of strategies by crypto platforms operating within the EU.
In light of these developments, the onus is increasingly on regulatory authorities and cryptocurrency platforms to find a balance that ensures compliance without stifling innovation.
The Netherlands is becoming a crucial testing ground for the implementation of MiCa, and the experiences gained from these developments could offer valuable insights into harmonizing the management of digital assets across the European Union.
With Gemini temporarily exiting the scene, the focus may shift to how effectively both regulators and the industry adapt to preserve market diversity while safeguarding consumer interests and safety.