Crypto-exchange Bitjux sues the Central Bank of the Netherlands

The Dutch bitcoin exchange Bitjux filed a lawsuit in the court of Rotterdam against the local central bank. It requires that the KYC check requirement be suspended when users withdraw funds.

The country’s authorities have obliged cryptocurrency service providers to check incoming and outgoing transactions in accordance with the Sanctions Act. In November 2019, the Central Bank of the Netherlands instructed cryptocurrency exchanges to ensure compliance with strict KYC procedures. Otherwise, companies began to face denial of registration.

Bitjux users need to confirm each address for withdrawal by sending a screenshot of the wallet or a signed message.

Late last year, Bitjux was one of three companies that received regulatory licenses. Twenty-five of the 38 applicants sent a joint letter to the Central Bank asking for greater clarity on the need to comply with the measures proposed.

Bitjux believes that the Central Bank of the Netherlands has not been able to solve the problem associated with the tightening of KYC-verification. The consulting company hired by the bitcoin exchange in the field of legal compliance after studying the situation came to the conclusion that the actions of the Central Bank have no basis.

Bitjux stressed that the introduction of an expanded wallet verification protocol violates existing customer privacy laws.

“We consider it extremely important for the judge to consider the position of the Bank of the Netherlands and to clarify the legality of these claims. We want to stop the complex processing of personal data and independently determine the need to confirm the ownership of the wallet to the customer,” the company said in a statement.

Recall, similar requirements for identification when the cryptocurrency is put on your own wallet may become mandatory for the U.S. bitcoin exchanges.