The Chief Economist at Israel’s Ministry of Finance, Shira Greenburg, published a list of recommendations for the regulation of digital assets on 28 November.
She called for a more comprehensive regulatory framework that would bring trading platforms and crypto issuers in line while expanding the powers given to its financial regulators.
This list of recommendations included building new regulatory infrastructure, introducing legislation to authorize and supervise the issuance of backed digital assets such as stablecoins, and facilitating financial services through such tokens.
The guidelines also included the need for a law to give the Bank of Israel the right to oversee digital assets with significant stability or monetary effect.
Additionally, it would allow the payment of taxes on cryptocurrency held outside Israel through the central bank. Lastly, the proposal would create an inter-ministerial committee to supervise the regulation of decentralized autonomous organizations (DAOs).
Greenberg also suggested that the Supervisor of Financial Service Providers should be given more authority to oversee licensing rules and to develop a more comprehensive taxation framework for the purchase and sale of digital assets. She emphasized the importance of lawmakers considering the concept of technological neutrality when enacting digital asset-related rules.
Is Israel not a crypto-centric country?
Data suggests that Israeli residents have accounted for 21 million blockchain-based transactions, which equates to 0.04% of all crypto transactions worldwide.
In early September, the country’s markets regulator granted its first permanent license to Hybrid Bridge Holdings to provide crypto services. In late October, the Tel Aviv Stock Exchange (TASE) announced that the body was contemplating building a blockchain-based digital asset trading platform.
Israel, however, is not a country big on cryptocurrencies as it stood on 111th rank in the global crypto adoption index published by Chainalysis.