Launching a cryptocurrency in The Netherlands

While launching an ICO, regulations from various fields will be applicable. However, it will heavily depend on the exact structure of the token and whether it will classify as security according the Dutch Financial Supervision Act (FSA). As from this moment, there is no clear framework and is judged case by case by the Dutch Authority for the Financial Markets (AFM) and the Dutch Central Bank. At this stage, it is advisable to get in touch with the relevant authorities in an early stage, in order to discuss whether a specific coin falls under the financial regulations or not. In the future there will be more specific rules and guidelines.

• KYC and AML regulations. Although not mandatory yet, it is advisable to keep track of whom is investing in your project
• The whitepaper shall be carefully written and not contain any referrals to the investor obtaining shares or rights on dividend.
• As organizer of the token sale, you have to take sufficient and necessary security measures. This means that you have to ensure that the invested money is secure. The same applies for any personal details that investors might have provided. According privacy regulations, the organizer is responsible (and liable) in case private information is stolen or otherwise exposed.
• Combicoin, a Dutch cryptocurrency that had its ICO in September and raised USD2,2 million. On January 9th 2018, the ICO organizers halted sales of Combicoin (expecting to resume in March), as they have had informal talks with the AFM, which expressed that the company behind Combicoin potentially qualifies as investment funds. This means that according article 2:65 FSA they would need the AFM to issue a permit, unless they meet the exemptions from article 2:66a FSA (main requirements: investment offered to at most 150 persons or only to professionals and investment amount at least €100,000). Futhermore, the product they offer would require a prospectus, either according chapter 4 FSA (open end) or chapter 5 FSA (closed end).