Israel is certainly not a country that is afraid of technology. It brought flash drives and Waze navigation to everyone and has consistently been in the top ten of world technological hubs. It’s no surprise, then, that Israelis are jumping to embrace cryptocurrency and its underlying technology—blockchain—despite the government pulling back the reins.
With more than $5 billion raised in venture capital in only one year, Israel is considered by many to be the major hub for startups. That has spilled over into cryptocurrencies, with the country’s largest bank, Hapoalim, partnering with Microsoft in 2017 in launching a blockchain-powered platform. The Israeli Tax Authority have also accepted cryptocurrencies, mandating that they be taxed as capital gains on property.
In February, the Israeli Supreme Court resolved a case brought by a gold broker, Bits of Gold, against the Leumi Bank, siding with the broker. The bank had refused to do business with the broker, as well as others in the cryptocurrency industry, citing the insecurity surrounding the digital currency. A district court had ruled in favor of the bank last year before Bits of Gold took the case before the Supreme Court.
Not everyone is getting behind the future, though. The Tel Aviv Stock Exchange has refused to include companies that deal in cryptocurrencies due to the high degree of volatility seen in the markets. As the markets, and acceptance, evolve, this will undoubtedly change for the better.
Israeli citizens have almost an inherent “build a better mousetrap” mentality that propels them to believe that there is always a better way to do things. That mentality has helped the community thrive, and has given rise to some of the most well-established technological advances today.
Israeli authorities have repeatedly said that they is more than open to accepting cryptocurrencies. However, they want to ensure that proper safeguards are put into place that outline how they are perceived from a legal point of view. There is still a long road ahead, but the recent decisions certainly demonstrate a favorable response to the industry. With its forward-thinking mentality, Israel could set the bar for other countries to try to reach.