Bybit discontinues some services in the Netherlands 🇳🇱 (But it is not leaving) (2024)

🏦 Another big crypto exchange is (partially) leaving the Netherlands ❌🇳🇱

No worries though, only some of Bybit's services are being discontinued. But they might be your favourite services of Bybit, and the reason why you are using the platform.

While I am a big fan and advocate of self-custody, and storing the seed phrase on a CRYPTOTAG , Bybit has been a great and user-friendly exchange, that can be used to on- and offramp, and store a small portion of your portfolio for the time being.

The developments in the Netherlands 🇳🇱

We're seeing some pretty "unique" developments within the crypto sector in the Netherlands. Since the implementation of AMLD5, DNB has actively enforced compliance, resulting in notable actions against major exchanges like Binance, Coinbase, and KuCoin for operating without proper registration or compliance.

These regulatory actions reflect the Netherlands' broader strategy to establish a controlled environment for cryptocurrency operations, balancing the potential of digital assets with the need to protect consumers and maintain financial stability.

While companies such as Kraken are receiving a VASP to operate in the Netherlands, others have to trim down on their offering to the Dutch. Is the DNB/AFM policy too strict and too picky? 😵 In 2022, the DNB stated that they did not see crypto as money.

Which crypto exchanges have already left the Netherlands?

1. Binance stopped serving Dutch crypto investors in July 2023, after they were unable to obtain a Virtual Asset Service Provider (#VASP) license, which basically means it was unable to sufficiently meet #AML standards. Since July 2023, none of the services of #Binance can be accessed by Dutch users in the Netherlands anymore.
2. As of November 2023, Gemini had to discontinue its services in the Netherlands, due to requirements imposed by the DNB.
3. Before the end of 2023, Gate.io users had to take their coins off the exchange already, as it was closing Dutch users' accounts on 2 January 2024.
4. KuCoin Exchange and Coinbase were warned and fined for operating in the Netherlands without a regulated license in 2022 but can now operate in the Netherlands.
5. Since June 2023, SATOS, a Dutch-registered crypto company that has the VASP license mentioned earlier, has been providing asset custody services for all Dutch users currently served by #Bybit. This construction made it possible for investors to keep using the services of Bybit, while in the back, the coins were legally stored by #SATOS.

Now, that has changed again. Bybit declared discontinuation of offering the derivatives service to #Dutch customers, due to strict guidelines by the De Nederlandsche Bank (#DNB). The first changes to the new regulations will be effective from 5 March.

The highlights of the changes for Bybit users in the Netherlands

• The Copy Trading service will be discontinued, starting from 5 March;
• Derivates trading will not be available anymore. New trades cannot be opened after 5 March and open derivatives trades need to be closed by 26 March;
• Spot Margin trading will still be available, with a maximum leverage of 10x ;
• The domain name for Dutch users will change to .nl from 22 March;
• New sign-ups for the Bybit Card will not be accepted after 5 March. Existing users can still use the card after the closure for new applicants;
• Bybit is aiming to tighten the partnership with SATOS, and work more closely with regulators and open a new office in Amsterdam, the Netherlands.

The future of crypto exchanges in the Netherlands

The Dutch #AFM, Authoriteit Financiële Markten, (Authority for the Financial Markets) and De Nederlandsche Bank will soon assess other crypto exchanges that are serving Dutch customers. Bybit and other exchanges have been working extensively with Dutch #regulators to follow guidelines and laws, but this does not stop here. The beginning of further regulations in frameworks such as Markets in Crypto-assets Regulation (#MiCAR) will for sure bring some more tensions.

While for some users it is fine to give up on some services, the future is in decentralized exchanges for other users. This way, they preserve control over their #digitalassets and can protect their #crypto from regulations, bankruptcies, and hacks.

As always, there is a risk profile for every crypto or #bitcoin investor. In the short-term, it might be okay to keep funds on an #exchange to quickly switch between coins or trade. But please only keep a small portion with centralized entities, and the biggest portion of your portfolio on a hardware wallet such as a Ledger or Trezor and create a solid #recoveryseed backup with a CRYPTOTAG.

What do you think? Are we in for a bumpy regulatory ride? 👇🎢