Israel’s Chief Economist Suggests Guidelines For Regulating Crypto

Shira Greenberg, the Ministry of Finance’s senior economist of Israel, has asked for a more comprehensive regulatory framework that would align trading platforms and crypto issuers and enhance the powers granted to its financial authorities.

The suggestions call for the development of new regulatory infrastructure, as well as legislative authority and oversight over the issuing of backed digital assets, such as stablecoins, and the supply of financial services through them. It also asks for legislation to be introduced to provide the Bank of Israel oversight over digital assets with major stability or monetary effect.

Greenberg suggested that Israel strengthen investor assurance and safety by establishing tougher licensing requirements on trading platforms and cryptocurrency issuers, as well as ensuring that monies derived from digital assets are managed more responsibly.

Greenberg also mentioned the necessity for particular licensing and monitoring procedures for stablecoin issuers in terms of legislation. The guidelines also contain a suggestion to facilitate the payment of taxes on crypto stored outside of Israel through the Bank of Israel. Furthermore, the plan calls for forming an inter-ministerial commission to monitor the regulation of decentralized autonomous organizations (DAOs).

The proposal includes a substantial section on cryptocurrency taxes. Uncollected crypto taxes from 2019 to 2022, according to Israel’s tax office, might total several billion shekels.

The chief economist also cited data in her report indicating that Israeli residents accounted for 21 million blockchain-based transactions in total, accounting for only 0.04% of all crypto transactions globally.

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