Dutch Finance Minister Calls for Cryptocurrency Regulations

The Dutch Finance Minister Wopke Hoekstra is the latest of many government officials to call for cryptocurrency regulations. His comments follow suit with the idea that 2018 will be the year of regulation in the cryptocurrency markets.

In a letter sent to Dutch parliament last Thursday, Hoekstra laid out framework for an international approach to cryptocurrency regulation that he claims would protect investors from scams that thrive within these markets.

In the proposal, Hoekstra covers a myriad of regulatory issues, including what credit card companies and exchanges can do to provide better protection for their customers. In the publically available documents, he says that he would like to talk to major credit card companies to see what additional measures they can take to shield customers from fraud, for example. 

In addition to talking to credit card companies, Hoekstra recommended regulating cryptocurrency exchanges by forcing them to register and to adhere to rules set forth by the government. He proposes that exchange regulations should be in place and enforced by 2019.

ICO’s have become notorious over the past several months following a report that claimed over half of all ICOs failed in 2017.  In his letter, Hoekstra has a major focus on ICO regulation, saying “It is being investigated whether investors in ICOs can become just as good protected as investors with a normal IPO or bond issue.  The current framework is not sufficient for this.”

His words on ICOs come after the United States Securities and Exchange Commission (SEC) announced that they would be enforcing regulation on ICOs that they deem are securities.

The Netherlands Authority for Financial Markets (AFM) issued a statement on ICOs last September calling them a “dangerous cocktail.” Hoekstra, referencing that AFM statement, proposed a ban on public advertisements for investments deemed risky by the government, like ICOs.

Hoekstra acknowledges that there is more research needed to form conclusive opinions and he believes that a unified regulatory framework that transcends borders in the European Union is critical for effective policies.