Netherlands-Based Coinbase Customers Required to Submit KYC Data When Transferring Crypto off the Platform – If they don’t provide KYC information, Dutch Coinbase users can find it more difficult to transmit money to people who have third-party or non-custodial wallets. Starting on June 27, 2022, users from the Netherlands must submit KYC information in order to transmit cryptocurrency to a wallet that is not hosted by Coinbase.
According to Coinbase, the new guidelines are being followed since the business must adhere to local laws. Virtual asset service providers (VASPs) are required to give KYC information on outgoing transactions utilizing non-custodial and third-party wallets under the 1977 Sanctions Act and the Money Laundering and Terrorist Financing Prevention Act.
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The Dutch Authority for Financial Markets (AFM) and the Netherlands Central Bank have codified the 1977 Sanctions Act (DNB). This requires Coinbase, or any Dutch VASP for that matter, to specify the recipient and reason for the cryptocurrency transfer.
Customers from the Netherlands can tick a box to indicate that the transfer is being sent to themselves when Coinbase applies the new regulation to them. The Dutch Coinbase user will need to give identification information if they want to transmit money to someone else outside of Coinbase.
Customers from the Netherlands must provide a “full name,” the “purpose of the transfer,” and the “full residential address of the recipient,” according to a blog post from Coinbase. If the individual does not know the address, they must pause and obtain it before continuing.
According to a blog post by the cryptocurrency trading site, “We are required to collect additional information for all transactions where a customer in the Netherlands sends crypto from their Coinbase exchange account to an address that is not managed by Coinbase.”
Even though the new regulation only applies to Netherlands customers, there are worries that other countries may adopt the same regulatory strategy.
Former Bitcoin Core developer Jeff Garzik stated on Twitter that “just the Netherlands for now, but expect this to expand.” “Don’t blame Coinbase; they would not voluntarily conduct something that is opposed to the interests of the majority of crypto consumers. The LEA desires to monitor all parties in every transaction.”
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Garzik added:
“Current crowd advice: Always deposit from, and withdraw to, your own wallet. It’s a good idea for security, privacy and accounting reasons, as well as legal.”
