A Norwegian crypto exchange loses the legal fight against a bank for closing its account claiming the court’s order in practice bans bitcoin trading in general in the country.
Norwegian crypto exchange loses the fight against the bank for closing its account
On one side, countries like Singapore, Switzerland, and Malta are trying to win the race of becoming a crypto hub while on the other side countries like China, India and Iran are banning the cryptocurrencies.
The newest addition to the list is Norway. Bitmynt AS, a Norwegian cryptocurrency exchange lost the case against Nordea, which is a Scandinavian financial services group. On May 4, the ruling for the case where Nordea was sued by Bitmynt for closing the account of the exchange was concluded.
It all started in December last year, when Sturle Sunde, the founder of Bitmynt filed a lawsuit against Nordea over its account being closed. Bitmynt’s account was closed due to inadequate anti-money laundering measures and terrorist financing risks.
According to the local media sources, now Sunde won’t be eligible to get established as a limited liability under the registration of Brønnøysund Register Centre. The Oslo District Court ruled out that:
“The Court is, after a global assessment, [in] no doubt that the risk of money laundering and transactions related to criminal offenses is clearly elevated by Bitcoin trade, although Bitcoin trading is now also largely done [under] legitimate conditions.”advertisement
Lack of money laundering measures to mitigate risks
By following the provisions of the Finance Contracts Act, the court considers it to be clearly a risk which gives the bank an objective reason to deny any customer relationship to the exchange.
Sunde is surely disappointed with the decision and says the verdict bans bitcoin trading in general in the country. He further counters that the no laws have been violated by the exchange and he will be appealing the decision.
However, the court believes that Sunde’s intuition as stated by the court “he believes he knows the customer and has a stomach feeling that makes him recognize suspicious conditions” along with the usage of Wallet Explorer does not mitigate the risks to the level that bank could pursue its relationship with the exchange.
In January, Norway clarified its stance on cryptocurrencies by considering them an asset and having them subject to capital gains taxation while stating that it’s not real money. However, the country doesn’t have any clear set of regulations in place and cases like these prove that in order to have the crypto exchanges run smoothly and further grow, Norway needs to introduce measures like Australia’s recent AML/CTF Rules.
Do you think Norway needs to put appropriate and firmer regulations in place? Share your thoughts with us!