Instructions on what you should know when trading or dealing with Bitcoin or cryptocurrencies in the Netherlands.
Netherlands or Netherlands, The European country (consisting of the Netherlands and the Caribbean islands of Aruba, Curacao and Bonaire) is one of the countries with the highest incomes in the European Union. It ranks tenth in terms of human development, according to the United Nations Human Development Index. It also has greater guarantees of economic freedom for its residents, which in turn are characterized by one of the strongest democratic systems in the world.
With regard to cryptocurrencies, both the authorities and the supervisory authorities of the country have made considerable efforts to create a legal framework for trading cryptocurrencies Bitcoin and the major digital currencies, in addition to the rules applicable to the countries of the European Union regarding the management and marketing of digital assets.
This new edition of “Everything you need to know …” examines the considerations that apply to digital currencies and technologies Blockchain in the Netherlands go into detail about the legal, economic, technological and social perspective that applies to the use of cryptocurrencies and their properties at the infrastructure level.
First, the use of Bitcoin as a means of payment is limited to the guidelines of the Court of Justice of the European Unionthat does not prohibit its use for the purchase of products and services. The Dutch Central Bank (DNB) found that the digital currency does not fall under the definition of money, precisely because it does not conform to the principles of the value reserve, the unit of account and the exchange medium, in particular due to the high volatility to which its price is subject.
In addition, there are no specific laws that need to be treated as such Bitcoin or cryptocurrencies, but depending on their operation, issue and commercial characteristics, Conditions set within the Dutch Market Surveillance Act (FMSA) for the legal treatment of these assets:
- Any asset that is covered as a means of payment in fiat currency is considered electronic money.
- They are considered to be securities and / or financial instruments if their possession is linked to profit-taking.
The main regulatory focus is on companies that operate cryptocurrency-related financial services that are properly regulated by the DNB and use the regulations in the Fourth Anti-Money Laundering Directive (AMLD5) for which a legislative proposal for the change is already available.
Nevertheless, there are no obstacles to an exchange to trade cryptocurrencies within the territory unless the legal requirements do not conflict with the type of digital currency in question.
In tax matters that is Residents of the Netherlands are subject to the corresponding tax return for cryptocurrency earnings. It depends on the annual balance derived from this activity to determine the margin or percentage that users must pay to the local tax authority.
It also applies to companies that operate with digital currencies that were once with the central bank and the operators under the provisions of the AMLD5, They would only be subject to payment of the relevant taxes in accordance with the annual income and expenditure balance.
Cryptocurrency mining in the Netherlands
In terms of cryptocurrency mining, the country doesn’t seem to be an attractive target for performing this type of commercial operation. Therefore, there are no reports of mining farms operating on a large scale locally.
For those interested in this activity, there are no legal framework that regulates this practice or imposes the payment of additional fees for the generation of new crypto assets. Therefore, the costs associated with this activity would be primarily those resulting from the value of the equipment, the corresponding power consumption and the bandwidth required to ensure its optimal operation.
The most popular cryptocurrencies in the Netherlands
Digital currencies enjoy a much more profitable economic situation for their residents and are popular as mechanisms or investment vehicles. A large number of users are interested in their options as a means of payment for products and services.
The digital currencies most popular in the field are the ones with the best commercial reputation, which highlights the case of Bitcoin and ether in particular.
In addition, the stock exchanges that offer their services to the country’s residents manage a broad catalog of digital currencies, from which outstanding ones stand out Bitcoin Cash, Litecoin, Ripple and many others.
An interesting fact, however, has to do with the provisions of local laws, especially for companies interested in spending their own digital assets. Depending on the type of token in question, it is up to the regulatory authorities to determine the type of legal treatment that will be granted to the cryptoactive in question.
Among the most frequently used stock exchanges that offer their services within the country are platforms such as Coinbase, BitPanda, Bitfinex, Kraken, Paybis, Coinmama, Binance, Deribit, TxBit, Coss, among other.
As in other countries, UK residents can use other P2P platforms such as: LocalBitcoins and / or LocalCryptos where stakeholders can trade BTC and ETH Determine the payment mechanism that is most convenient for you.
Commercial launch of cryptocurrencies in the Netherlands
Despite the fact that digital currencies see a greater benefit as an investment mechanism, there are more and more merchants in the country interested in accepting cryptocurrency payments. A high concentration is observed in places like Amsterdam, Rotterdam, Arnhem and Utrecht.
According to data from Coinmap.orghas the nation More than 350 companies accept digital currencies as a form of payment spread over its territory, the cities mentioned above being the ones registering the most establishments of this type.
In the Netherlands, these are usually the companies that most commonly accept this form of payment in the country Shops, restaurants, hotels, bars and tourist attractions.
Although regulatory aspects also come into play when new technologies are introduced, Both the Dutch government and the private sector are very interested in the applicability of Blockchain in different areas.
Since 2016, the local government has started efforts to identify the potential of these technologies and promote their use in the development of products and services. At that time, she announced her intention to create a new virtual currency that would be supported by the EU Central bank. However, recently the directors of the financial institution indicated that they supported the idea of creating a digital euro.
As part of the current pandemic of COVID-19, Blockchain Public Health Consortium (PHBC) announced the launch of the platform in March VirusBlockchain.com, a block technology based system to track the mobility of healthy people and prevent the spread of diseases such as Corona virus.
A great success in Blockchain comes from the platform “Known digital identity of travelers ”(KTDI), Pilot project based on this technology that allows users to travel between the Netherlands and Canada without a passport. The project is responsible for the organization WEF, and implements cryptographic technology to protect passenger information and automate the customs verification process.
If you want to learn more about other countries, you can see them in the following list, which grows from week to week:
Everything you need to know about Bitcoin and cryptocurrencies in the world
Angel Di Matteo’s articles / DailyBitcoin
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