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Dutch Finance Minister Addresses Cryptocurrency Regulation In Letter To Parliament

This month, the Dutch finance minister remarked upon cryptocurrency legislation within the Netherlands and the European Union.

On March eight, 2018, the minister of finance for the Netherlands, Wopke Hoekstra (Christian Democratic Appeal celebration), printed a six-page letter to the Dutch Parliament at the subjects of cryptocurrency oversight and legislation.

Hoekstra famous that an estimated 500,000 Dutch families at the moment are in ownership of digital foreign money, in line with marketplace analysis company Kantar TNS, however he cautioned that “investing in Bitcoin or other cryptocurrency is not without risks.”

The finance minister defined that digital currencies lack the fundamental promises afforded through government-issued currencies and frightened that there’s no possibility for recourse thru a centralized issuer “in case[s] of misconduct” like hacking or robbery. He additionally highlighted considerations about cash laundering and terrorist utilization of cryptocurrencies.

To keep an eye on the dangers of cryptocurrency, Hoekstra urged a four-part method:

  • Gaps in client and investor coverage should be closed, however measures should be proportionate. 
  • The integrity of the monetary gadget should be assured.
  • The cutting edge ways in the back of cryptocurrency, akin to cryptography and allotted ledger era (DLT), should be preserved.
  • The cross-border nature of cryptocurrency calls for one method on the world stage. National regulations, that are tricky to care for can simply be circumvented.

The finance minister pledged to “consult” with credit card companies regarding cryptocurrency purchases, apparently after an inquiry by two MPs.

A few weeks ago, ETHNews reported on questions submitted to Hoekstra by MP Henk Nijboer (Labour Party) about ING Group’s banking relationships with two prominent cryptocurrency companies. While Hoekstra did not address the worrisome rumors about Bitfinex and Tether in his letter to Parliament, the finance minister obviously has his finger on the cryptocurrency pulse, which bodes well for market participants.

With respect to international efforts, Hoekstra lauded the European Commission’s work related to cryptocurrency, and acknowledged calls for virtual currency regulation by his counterparts in France and Germany. Realizing the global nature of cryptocurrency, he encouraged cooperative efforts, like the discussions which will take place at the G20. The Netherlands, Hoekstra wrote, is also party to the Financial Action Task Force.

Addressing an inquiry by MP Farid Azarkan (DENK), the finance minister said that the Dutch central government is “not active as an investor and therefore does not [undertake] speculative investments,” a policy that extends to cryptocurrency.

Under existing rules and regulations, Hoekstra said, cryptocurrencies and related tokens “usually” do not qualify as financial instruments or investments. Likewise, there is no specific guidance for the design of cryptocurrency exchanges and the Dutch Authority for the Financial Markets (AFM) cannot “enforce performance.”

However, the finance minister said rules laid out by the Authority for Consumers and Markets (ACM) do apply, “such as requirements for information and reflection time when selling over the internet.” He noted that, unfortunately, these standards offer a “lower level of protection.”

Finally, Hoekstra promised to “dedicate” himself to a “European approach to ICOs,” likely in recognition of the European Commission’s recent FinTech action plan. Published last week, the plan found that “an assessment of the suitability of the current EU regulatory framework” with respect to ICOs is necessary.

Translations by Google.

Matthew is a writer with a passion for emerging technology. Prior to joining ETHNews, he interned for the U.S. Securities and Exchange Commission as well as the OECD. He graduated cum laude from Georgetown University where he studied international economics. In his spare time, Matthew loves playing basketball and listening to podcasts. He currently lives in Los Angeles. Matthew is a full-time staff writer for ETHNews.

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