There are many countries in the world that are still deciding how they want to embrace blockchain innovation while still enacting cryptocurrency regulation, and Israel is one of them. This week, a judge in Israel has just shaken up the cryptocurrency community by ruling on a cryptocurrency miner’s account in Tel Aviv. The company involved was Israminer, which is a division of Yashraminer, a Ukrainian cryptocurrency mining company. The bank involved was Union Bank, of Herzliya industrial district.
The judge’s ruling and comments seemed to understand the dilemma that many governments all around the world are facing. The judge acknowledged that the bank handling the money was risky with regards to anti money-laundering laws, while simultaneously acknowledging that the bank went too far in entirely closing Israminer’s accounts.
The judge’s name is Limor Bibi, and he believes that “sweeping policy” with regards to certain accounts is unreasonable, since there are so many different types of customers, and the scope of activity should be taken into consideration. Regardless, Bibi sided with the Union Bank for complying with 2014 Israeli anti-money laundering law that has not been updated in years.
The case has made international headlines, as cases often do that explore the right of banks to close down cryptocurrency-related accounts. There have been judges that have ruled various ways, and many see this ruling as a win ultimately for the banks. It is obvious that this isn’t exactly inspiring for the cryptocurrency community, many of whom oppose traditional banks on a very basic level. The judge did acknowledge that the bank was wrong to close the account—which some might consider a win, but ultimately, that the bank was right to refuse deposits.
Even though there are more corporations than ever that are embracing blockchain and the ways that it might be able to revolutionize their sector, traditional finance moves at its own pace. There are many banks all over the world that are still reluctant about doing business with cryptocurrency exchanges and other blockchain startups.
Since cryptocurrency is not fully regulated in so many countries, there is the notion that there might be all sorts of criminals using the cryptocurrency sector to launder profits. It is obvious that banks do not want to deal with that sort of headache or scandal. Banks have refused to do business with various cryptocurrency exchanges. This recently occurred in various countries, including India, where banks closed down the accounts of major cryptocurrency platforms early last year.
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