Israel Shares Report On How It Will Handle Bitcoin & Other Cryptocurrencies
Israel Securities Authority (ISA) Committee, for the Examination and Regulation of Initial Coin Offerings (ICOs) this week, has issued a series of “recommendations designed to dispel uncertainty and strike a balance between technological innovation and the protection of the investors”
The authority is conducting a study on whether or not digital currencies such as Bitcoin should be considered securities. This decision may in turn pose a deep impact on future regulations of the currency.
The ISA Committee shares,
“As a general rule, cryptocurrencies that are designed to be used exclusively as a medium of payment, clearing, or exchange and are not limited to a specific venture; that do not confer additional rights; and are not controlled by a central entity — will not be deemed securities.”
Many analysts consider this to be an exemplar decision since many countries around the world have been trying hard to sort out the classification and regulation of cryptocurrencies. That ways, Israel looks superior in the race by adopting a hands-off approach regarding the regulation of cryptocurrencies. However, Bitcoin ATMs in Israel, in contrast to those in the United States, do not require basic customer identification. One can put in fiat and receive Bitcoin.
The released report explains,
“The question of whether a cryptocurrency should be considered as security will be decided on the totality of the circumstances and features of each case in accordance with the purposes of the law. As a general rule, cryptocurrencies that confer rights similar to the rights conferred by traditional securities such as shares, bonds, and participation units, will be deemed securities. In contrast, cryptocurrencies that represent rights to a product or service and are acquired solely for the purpose of consumption and use, and not for investment purposes, will not be considered securities.”
ISA Chair Ms. Anat Guetta received several recommendations who has been treating Bitcoin in a rather hostile manner. SGuetta explained,
“We have decided to prevent the exposure of passive investors to companies whose main activity involves cryptocurrencies. Investment in these companies is high risk, speculative and volatile. We also published a detailed warning to investors about the dangers of investing in cryptocurrency.”
Also Read: Belarus Adopts Crypto Accounting Standard
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