Cryptocurrency market showing explosive change

The Israel Bitcoin Association (IBA) and the Israeli Crypto Community (ICC) hosted a conference on March 10 regarding cryptocurrency and regulation in Tel Aviv.

 Representations of virtual currency bitcoin are seen in front of Tesla logo in this illustration (photo credit: REUTERS/DADO RUVIC/FILE PHOTO)
Representations of virtual currency bitcoin are seen in front of Tesla logo in this illustration
(photo credit: REUTERS/DADO RUVIC/FILE PHOTO)

The Israel Bitcoin Association (IBA) and the Israeli Crypto Community (ICC) hosted a conference on March 10 regarding cryptocurrency and regulation in Tel Aviv. Among the speakers at the event were Minister of Science and Development Orit Farkash, Tax Authority head Eran Yaakov and Tectona chairman Yariv Gilat.

“The market here contains enormous potential and opportunities,” Farkash said at the event. ”It’s similar to the development of the Internet; it’s showing an explosive change. The digital asset market has exceeded a worth of $3 trillion, with over 100 countries that are dealing in coins – and we are considerably behind in terms of regulation.

“We saw the Presidential order published the day before yesterday. The United Arab Emirates has said that it is a haven for crypto, Miami is adapting it, and we need to create tools that will allow us to take action,” she said.

“We created an interdepartmental task force that is on track to articulate conclusions in the near future,” Farkash said. “It is extremely important for us to demonstrate our stance, which is to remove barriers to innovation as fast as possible. We want to adopt a policy of responsible development in order to allow the coins to be active in the economy, to provide solutions to potential barriers and to see this as a strategic advantage for Israeli hi-tech.”

“I want to look at this as an opportunity for Israel,” Yaakov said. “We need to make an effort in order to make this work – and there is a lot of brainpower here that will allow Israel to be a pioneer in the industry.”

 Celsius Network founder Daniel S. Leon, Science and Development Minister Orit Farkash and IBA’s Nir Hirshman. (credit: GIDEON MARKOVICH) Celsius Network founder Daniel S. Leon, Science and Development Minister Orit Farkash and IBA’s Nir Hirshman. (credit: GIDEON MARKOVICH)

The Tax Authority will address the issue of non-fungible tokens and how to tax them, he said. “In 2021 there were $40 billion in NFTs. A part of it was in Israel and of course will be subject to taxes. Throughout the day, we will release a clarification regarding NFTs as an asset subject to taxes.”

”Private citizens and Ukrainian institutions make use of digital currency channels in order to raise money for donations,” Gilat said. “I don‘t think that we can see a tool that works better than the existing infrastructure. On the other hand, whoever wants to use Bitcoin as a means of refuge for digital gold, we‘re still not at that stage.”

DANIEL S. LEON, founder, partner and president of the Israeli-American crypto giant Celsius Network said that “American President Joe Biden signed a decree yesterday regulating the branch of cryptocurrency in the United States. This is exactly the chance for Israel to lead the global regulation in the industry and define the landscape of crypto regulation.

“It will be the mistake of a generation if the decision-makers will not be brave enough and will hold Israel back in the process,” he warned. “We at Celsius are ready to assist with whatever is needed.

“Transparency is a critical component in this issue,” Leon said. “The crypto companies that will not operate with transparency will be vulnerable and will disappear from the scene quickly. We are founding a Research and Development Center in Israel and are aiming for it to be the R&D leader in our company. No foreign programmer will be able to replace an Israeli programmer.”

Nir Hirshman, CEO of the crypto forum Israeli Bitcoin Association announced the founding of the crypto companies forum. “Israel has the option to become a global financial leader to base its technological innovation and strengthen its global status using the digital currency industry,” he said.

“It will not be simple. What we are hearing from every place is ‘listen, we want to be here but our investors are anxious to pull out, our employees are suffering and sometimes we are not even able to pay taxes.’

“Decision-makers, regulators: This is your moment. The responsibility is yours to ensure that Israel is not left behind and to open the market.”

It is clear that local regulation is a central issue that must be addressed, the event’s organizers said, otherwise Israel may continue to relocate its best minds abroad and it’s the responsibility of the regulators to prevent this.

This is an incredible industry that can bring a lot of value to Israel like it does in every other country that has regulations in place, they said. They understand the difficulty for regulators to build a new system of rules that addresses the true essence of the business, but we cannot stop innovation!