Regulation
Dutch government does not fund cryptocurrency regulation
THE HAGUE – The Ministry of Finance is not funding the regulation and supervision of cryptocurrencies. The ministry has repeatedly rejected requests for additional funding from the Financial Markets Authority (AFM) and has even limited the contributions that the regulator can request from the sector, Financieele Dagblad reports based on documents received from the ministry under the Government Transparency Act.
The AFM is to strengthen its oversight of the cryptocurrency market in order to comply with the new European legislation on the sector, MiCA, which will come into force at the end of this year. The regulator has repeatedly asked the ministry to fund this additional oversight, but its calls have fallen on deaf ears, according to FD.
According to documents in the possession of the FD, the ministry has described a government contribution to the supervision of cryptocurrencies as “politically unfeasible”. The government appears to be much less concerned about cryptocurrency fraud than the AFM itself.
The regulator had defined three levels of supervision for the cryptocurrency market: “basic, enhanced and minimal”. It said that the “minimal” option would not be enough to join the MiCA. However, this is the option chosen by the government.
“Given the risks in the cryptocurrency sector,” the ministry told the AFM, according to FD, “we advise continuing with the minimal scenario.”
The AFM declined to comment on the lack of public funding for the FD. However, it said it would focus its efforts on issues that are most likely to harm consumers, investors and market participants.
The ministry told the FD that it made capacity decisions in consultation with the AFM.