In a letter to the parliament, Wopke Bastiaan Hoekstra, the Dutch Finance Minister advocated for international ICO regulations. In his letter, he focused on new and improved consumer protection. Moreover, Mr. Hoekstra wants to get in touch with the credit card companies to discuss such risks in depth. He wants stronger instituting to offer robust protection for the crypto users who buy cryptocurrency using credit cards.
The letter by Hoekstra focuses on different proposals including concentrating on cryptocurrency services and local exchange platforms. He proposes that cryptocurrency services be registered with the government. Furthermore, he wants compliance with the know-your-customer-requirements (KYC) by the year 2019. His letter also sheds light on protecting the participants of ICOs.
Some Highlights of the Letter by Dutch Finance Minister
Here are some takeaways from the letter of the Dutch Finance Minister.
One of the major areas of focus is to help the ICOs get the same level of protection as a normal IPO or that of bond issue. Therefore, he recommends making the current framework robust to accomplish that level of protection. The regulators in Netherlands have already flagged issues related to crypto-technology, particularly ICOs.
Last November, the Netherlands Authority for Financial Markets (AFMs), a regulatory body just like the US Securities and Exchange Commission in the US, issued a statement, labeling the ICO market as a “dangerous cocktail”. Hoekstra had endorsed those statements by AFM to not allow advertising of any risky financial products to the customers.
Do Stricter International ICO Regulations Truly Reflect Dutch Approach Towards Cryptocurrencies?
Not necessarily. If you have lately followed the Dutch, they are very much into upcoming technologies. These new calls for stronger international ICO regulations somewhat confirm the earlier doubts of an unclear Dutch position on regulations and cryptocurrencies. An event held back in January this year in Netherlands was aimed to gather some of the well-known crypto personalities in Netherlands to attract investors towards business, institutional, and cryptocurrency spaces.
Let us look at how the founder of Web 3 Ventures, an organization which enables entrepreneurs and developers to bring decentralized autonomous services to blockchain community), looks at ICOs and the crypto space within the country.
Here are some highlights from the Web3 Ventures Founder’s interview on cryptocurrency space in Netherlands with NLTimes.nl.
· He focused on the importance of the role the Royal family of Netherlands was playing in the blockchain initiatives.
· The building of awareness, due to the efforts of domestic businesses and institutional actors, have been successful in making the crypto space a lot safer.
· The Founder of Web3 Ventures also pointed to the need for Netherlands to develop a clearer stance on cryptocurrencies.
· On ICOs, he was positive about their role as financial tools to enable monetization directly with the development of the infrastructure. Also, he appreciated ICOs for letting communities become symbolic owners of those infrastructures.
· On protection of investors when buying ICOs, he was of the opinion that investors must look for thorough analysis of the business model, meticulous due diligence, and management’s track record. He also wanted them to focus on the need for governance of companies or foundations behind different crowdfunding efforts. Lastly, he also asked the cryptocurrency enthusiasts to stay clear of projects with too high market cap as they would mostly deliver poor performances (as per him).
On responsibility of weeding out fraudulent ICOs, he was of the view that ICOs should be self-regulated and technologically-driven. Among other suggestions, he asked for ICOs to become part of the Interactive ICO (IICO) group, and also participate in third-party audits of the governing smart contracts to promote greater transparency and self-accountability.