In a landmark judgment, the Supreme Court of Israel has directed banks to not disrupt any cryptocurrency-related activity. The judgment was pertaining to the Leumi Bank which had restricted the activity of cryptocurrency broker Bits of Gold.
Positive Precedent in Israel
This particular judgment by the Supreme Court of Israel is a clear precedent for other cryptocurrency related restrictions in the country. It clearly states that none of the banks should restrict the banking facilities or any other activity of cryptocurrency-related companies.
Bits of Gold used the banking facilities of Leumi Bank which were then restricted due to money laundering fears. Israel had also launched anti-money laundering regulations which led the bank to deny banking facilities to the cryptocurrency broker.
The bank also restricted the use of its banking facilities to other cryptocurrency exchanges in December of last year. The bank was able to do so through the gambling laws in Israel. The law states that websites which provide gambling facilities to Israeli citizens should not be provided banking facilities.
According to the CEO of Bits of Gold, Yuval Roash, the continuation of banking facilities will help the cryptocurrency businesses in the country. It will also prevent other banks from restricting any other facilities to cryptocurrency businesses.
According to the judge, the bank restricted the banking facilities only on suspicion. There was no clear evidence against the cryptocurrency exchange. The judge clearly stated that as there was no history of violation of law by the cryptocurrency exchange in the last 5 years, there is no evidence to support that the cryptocurrency exchange violated the law.
The regulatory framework in Israel is being continuously upgraded to accommodate cryptocurrency related regulations. The Israeli Securities Authority has already stated that it will be regulating ICOs in order to protect the investors. Also, the government has previously stated that it will launch its own national cryptocurrency as well. This is the reason why the government is not likely to ban cryptocurrencies outright.
However, this positive judgment from the Supreme Court of Israel is surely a shot in the arm for most cryptocurrency businesses in the country. Now, most of the cryptocurrency businesses in the country will be able to gain access to banking facilities in order to conduct their day-to-day transactions.