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Israel’s Tel Aviv court rules bank can refuse to accept deposits originating from crypto entities




Israel's Tel Aviv court rules Bank can refuse to deposit crypto transacted funds but cannot close client's account
Source: Pixabay

A Tel Aviv District Court, for the second time, ruled that the Union Bank of Israel [UBI] will not be allowed to close the account of mining firm, Israminers Ltd. However, the bank can choose to refuse deposits originating from cryptocurrency entities, the court ruled.

Tel Aviv District Court Judge Limor Bibi, in her judgment, stated that the bank’s policy against depositing funds originating from anonymous cryptocurrency trades was justifiable, in order to curb money laundering and function in accordance with legal requirements like KYC.

However, the court did rule that the bank’s sweeping policy “did not distinguish between activity, the scope of activity and different types of activity.” According to Bibi, the Israeli bank’s hostile stance to deny operating an account dealing with virtual assets was too ‘broad’.

Israminers had filed an appeal last year after a branch in the Tel Aviv area claimed that the firm had violated the bank’s policy.

This is not the first instance where an Israeli legacy banking entity was asked by the courts not to halt crypto-related activity and its clients, without a legitimate argument.

In May 2018, the same Tel Aviv District Court forced Israel’s biggest banking institution, Bank Hapoalim, to accept the transfer of funds resulting from a client’s Bitcoin sale, even when the account holder presented documents which clearly stated the exact source of the funds. The client was denied a deposit of $195k originating from a Bitcoin trading platform, following which the court refused the bank’s argument of there being a violation on the client’s side.

Earlier in March, the Israel Securities Authority [ISA] issued its final report on cryptocurrency regulation. The framework was outlined to bolster the crypto sector and secure the rights of the crypto investor.

The ISA with respect to cryptocurrency assets stated,

“The committee recognizes the great importance of the direct connection between the Securities Authority and the sector in order to further professionalism among its employees, recognition of the sector by the Securities Authority, study of its special characteristics, and providing a fitting regulatory solution for it.”

Anat Guetta, the Chairwoman of the ISA, had earlier asserted that the dynamic and innovative technology associated with crypto, was here to stay.

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Bitcoin’s volatility – an indication of growth or regression?

Biraajmaan Tamuly



Bitcoin's volatility indicated to be a key aspect of its current success
Source: Pixabay

Market volatility plays a huge role in the financial ecosystem of assets and cryptocurrencies are regularly linked to its predominant effect. Whenever Bitcoin exhibits a rapid price movement in the market, the majority of the critics tagged the digital currency with extreme volatility and state that it would eventually lead to its downfall, since crypto assets cannot be trusted on a long term basis.

This assumption was recently widely questioned as data showed that over the last few months, the volatility rate had actually decreased for Bitcoin but the community continued to talk against the coin’s development solely on the basis of the crash witnessed by BTC after the bull run of 2017.

Pierre Rochard, a bitcoin enthusiast, recently spoke about the situation and stated, that the volatility might actually be one of the reasons why Bitcoin was starting to find prominent success in the market.

It was suggested that Bitcoin had been accumulating value over the years through various implementations and at specific time frames, short-term traders were causing an effect on the price, which would cause the “incidental price surge”. The price surge would then undergo correction and witness a fall but the price would continue to grow at a progressive rate.

The aforementioned reason can be backed by the fact that Bitcoin had indeed outperformed the likes of commodities like gold in the recent market analysis, and it was released that Bitcoin attained more profit in the long-term returns and risks asset trade in comparison to the S&P 500.

A recent data also exhibited that since 2013, any investment that included 5 percent Bitcoin to 95 percent fiat currency gathered more returns and lesser risk than the S&P 500; which also witnessed losses in 2017.

Twitter user @1Mark Moss indicated that Bitcoin was growing at it’s natural growth rate and stated,

“The volatility is the difference between perception and reality. And the reality is BTC continues to progress, just not as fast as the perception makes it seem sometimes… just part of the natural evolution.”

However, another user @JordiMorris1 explained that the people had more to do with the volatility and anything else. He said,

“The relationship of people towards Bitcoin is volatile. Bitcoin is predictible by nature, its production is stable independently of how crazy people go about Bitcoin. No sense to blame on Bitcoin.”

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