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De Nederlandsche Bank (DNB) has imposed an administrative fine of €2.25m on Dubai-headquartered crypto firm Bybit Fintech Limited (Bybit) for operating in the Netherlands without the required legal registration.
According to the Dutch central bank, Bybit’s operations in the Netherlands violated the Anti-Money Laundering and Anti-Terrorist Financing Act (Wwft), which mandates registration for crypto service providers with DNB.
This regulation, introduced in May 2020, stems from EU-level directives and brings into scope crypto services.
The DNB said that by not registering, Bybit neglected its gatekeeping responsibilities under the Wwft, inhibiting its ability to report unusual transactions to the Financial Intelligence Unit-Netherlands (FIU-NL).
This regulatory gap may have allowed suspicious transactions to evade scrutiny by Dutch authorities.
“In imposing the fine and setting its amount at €2,250,000, DNB considered the severity, extent, duration and severe culpability of the non-compliance,” the central bank said.
“The final amount of the fine was reduced because of the steps Bybit took to end the non-compliance and prevent its recurrence by facilitating the transfer of its Dutch customers to a local partner.”
Bybit has six weeks from receipt of notification of the fine to lodge an objection.
Bybit’s response
On its website, the crypto firm has said that it acknowledges the fine and respects the decision.
According to the firm, it initiated remediation efforts in 2022 by transferring Dutch customers to SATOS B.V., completing the process by September 15, 2023.
Since then, Bybit has operated through SATOS’ DNB-accredited Virtual Asset Service Provider (VASP) licence.
Bybit said that this partnership, along with its new Amsterdam office, reflects its commitment to compliant and secure crypto services in the Netherlands.
“At Bybit, we remain committed to working closely with European regulators to build a responsible and transparent ecosystem,” said Ben Zhou, the firm’s co-founder and CEO.
“We are excited to continue providing secure, reliable services to the Dutch community as we responsibly expand across Europe."
The news comes after Bybit recently reached a settlement with the notorious FTX, which has experienced a dramatic fall from grace.
In late October, FTX agreed to abandon litigation against Bybit Fintech Ltd and related entities in a deal worth roughly $228m that will enable FTX to withdraw assets from Bybit’s cryptocurrency exchange.
FTX asked the US Bankruptcy Court for the District of Delaware on October 24 to approve a settlement it had reached with Bybit and related defendants following months of negotiations.
The deal allows FTX’s liquidating estate to recover $175m worth of digital assets being held on Bybit’s exchange and sell BIT tokens to Bybit’s investment arm, Mirana Corp., for nearly $53m.
