The Netherlands-based cryptocurrency exchange Bitonic has announced it had filed a preliminary injunction at the court in Rotterdam to contest the Dutch central bank's (DNB) decision of stricter verification requirements over digital wallets.
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According to a statement, the exchange wants to quickly halt "the comprehensive processing of personal data" imposed on it by the watchdog.
"We want to return to the situation where we ourselves determine, on a risk-based basis, whether we ask the customer to prove his management of the wallet," the Bitonic team wrote in the statement.
Bitonic said it did not receive a "convincing answer" from the regulator to the questions it raised on the matter during the registration process in which it was granted to operate as a provider of cryptoservices. The cryptocurrency trading platform neither received a reply to a letter to DNB, sent in early November 2020 by 25 of the 38 registering parties.
In November last year, the DNB imposed limitations on cryptocurrency exchanges with an additional verification measure regarding bitcoin (EXANTE: Bitcoin) addresses. According to the local cryptocurrency exchange Bitonic, the DNB "effectively forced" it to enhance the verification process in reference to the Sanction Act.
According to the watchdog, crypto providers are obliged to check whether their clients and any ultimate beneficiary owners are on a Dutch or European sanctions list and report any hits to DNB. The Sanction Act compliance also entails that institutions "must check incoming and outgoing payment transfers, and block and report them to DNB in the event of a hit."
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