Israel and the crypto economy
The country of Israel has been making headlines in the news as of late for their different comments, actions and potential actions on Bitcoin and other cryptocurrencies.
Relatively recently, Benjamin Netanyahu, their Prime Minister, commented on the reason why Bitcoin was so successful and both how and why it would have an impact on banks and financial institutions going forward.
Then, the Israeli Central bank has been looking at the possibility of implementing a crypto shekel, but they are still in the early stages of that proposal.
Now, we are experiencing some confusion in another regulatory body in the state of Israel, (maybe they didn’t get the memo from their regulatory and legislative peers). A representative from the Israeli Securities Authority (ISA), Hauser, stated to the publication Reuters, that they are going to be looking at different companies closely and will be determining if they have to impose stringent regulations.
The specific companies of focus will be that of those that are aiming to have primary activities in the cryptocurrency sector.
Hauser, the leader of the ISA, stated that they are seeking to review a plan that will be introduced in the upcoming year. The proposal would prohibit bitcoin trading and crypto business entities from being a part of the Tel Aviv Stock Exchange (TASE).
“If we have a company [and] their main business is digital currencies, we would not allow it. If already listed, its trading will be suspended.”
There are a few steps that this proposal must go through before being implemented and being in effect. First, the plan must be accepted and approved, then it must be presented at a public hearing and then it would be implemented if everything works out without any objections or hassles.
Once it passes all these steps, it would then be a law that their exchange would have to heed.
The move is not unexpected
The ISA has been looking into the emerging market since August of this year and have stated that they would be reviewing the concept of ICO’s as they progress. There have not been significant movements by the regulator until now.
The ISA may be looking to be more stringent because some companies may be taking advantage of the sector by merely stating that they are a blockchain company. These companies brand themselves as a technology-focused business entity, just to see their shares jump, despite the fact that they may have no plans to implement or deploy blockchain technology in the present or the future.
How are market participants responding?
A CEO of a brokerage has commented on the matter, stating that they did have the ability to open up room for Bitcoin futures on the Israeli exchange. Their statements can be perceived as a defiant response to the ISA. Especially at a time when the regulatory watchdog is going to be looking at a plan to ban bitcoin trading and affiliated business entities from the exchange.
Assous, the CEO a brokerage named IBI Brokerage and a representative of a non-banking association stated that if it was good for CBOE, it must be good for them as well.
He believes that it is necessary for their stock exchange to participate now and continue to compete in this emerging market as there will be various opportunities to move forward and do well on a global scale.
He thinks that it is necessary to take actions in this sector now to be able to be a leader in the space as they progress.
Hauser’s past comments
Hauser has mentioned in the past that he is interested in the development of the sector but that there must be regulation. He also noted that there’s a possibility for those who do build up the system currently to be a global hub of support for the cryptocurrency ecosystem.
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“I believe that the topic of digital currencies and their offerings must receive a favorable regulatory response, maybe even daring somewhat, to give a chance for the option to develop an international financial center for security-coin from the type of ICOs.”