Having spent €9,000 on court expenses, the founder of BTC.ee bitcoin exchange Otto de Voogd gets his trial suspended. He now believes Estonia is similar to Russia in its anti-innovation stance.
Formal charges have never been brought against de Voogd, says Bitcoin Magazine. However, he risked three years in prison and a fine of €32,000 for running an unlicensed bitcoin exchange.
De Voogd claims that the whole purpose of BTC.ee was to help people get started with bitcoin so he mainly answered other people’s questions and the meagre profits he made (amounting to about €270) were not worth the time he spent on it.
According to de Voogd, the total volume of BTC.ee trading was below the EU anti-money laundering reporting threshold for a single transaction, so he did not expect any special attention from the authorities. However, in February 2014, the Estonian Financial Intelligence Unit and Border Guard Board emailed him requesting details about his company and its anti-money laundering procedures.
Over the next two years, de Voogd spent almost €9,000 on lawyers (a small part of which was compensated by donations from fellow bitcoiners amounting to €480 and 1.41 BTC) and ended up with a belief that in what concerns innovation Estonia is by no means a Western country. To him, it is more like Russia: “Permissionless innovation is not part of their system, you must wait until something is explicitly authorized.”
De Voogd claims that the Baltic state “did the utmost to hinder and hamper Bitcoin use, and by extension all other blockchain-based tokens and assets.” According to him, Estonia’s cryptocurrency requirements are the strictest in the EU. A bitcoin trader is obliged to meet customers in person, keep their IDs and report those who trade more than €1,000 per month.
The open session on the case of Otto de Voogt started in February 2016 but he did not attend the hearing, having already returned to his native Netherlands in 2014. He finally obtained the suspension of his case using the article 22 of the Estonian Constitution: “No one shall be compelled to testify against himself or herself, or against those closest to him or her.” He answered all the questions from investigators with the same phrase:
“I have reason to believe that answering this question could provide the police with information that could be used against me in a court of law, therefore I respectfully decline to answer this question so as to avoid the risk of incriminating myself.”
Curiously enough, Estonia in has a general reputation of a country rather open to blockchain innovations. In November 2015, Estonian government partnered with Bitnation to provide public notary services based on blockchain technology. Earlier in 2015, Estonian LHV bank concluded a partnership with the UK-based bitcoin exchange Coinfloor, as well as with a Colored Coins software company ChromaWay AB, creating a blockchain-based platform and a wallet for P2P transactions.
Apparently, Estonian authorities do not have a clear-cut position on bitcoin and blockchain. Different institutions may vary in their approaches. Thus, while LHV Bank is interested in bitcoin, SEB Bank treats any cryptocurrency operations with a great suspicion and tends to close accounts associated with bitcoin trade.