- The ISA would alter three current financial regulations to embrace digital assets.
- The new crypto legislation will be implemented six months after being approved and publicized.
In order to provide the market with greater clarity, the Israel Securities Authority (ISA) is trying to develop a new legal framework for digital assets that primarily fall under its jurisdiction.
According to the agency, the ideas are meant to shield investors against hazards, which have been prevalent during the last year.
The paper mentioned the collapse of the cryptocurrency exchange FTX while pointing out that Israeli ownership of the defunct cryptocurrency lender Celsius, which caused a decline in the cryptocurrency market last summer, was mentioned.
The proposed revisions also aim to preserve the ability to modify the legislation to accommodate the industry’s rapid technological advancement.
Digital assets would be covered by rules governing securities, joint investments, financial advice, marketing, and portfolio management, according to a proposal by the Israel Securities Authority.
How digital assets are represented in each situation is a digital representation of value used for financial investment and can be transferred and maintained electronically through the use of distributed ledger technology or another technology.
The proposed revisions are accessible for public comment until February 12th. The ISA advises giving organizations and the regulator six months from publication before the rules are put into effect so they may get ready for monitoring.
According to the authority, cryptocurrencies present a chance for investors and the Israeli economy by enabling more varied funding sources and fostering innovation and growth. In the document, it says:
“The advanced technology in these assets can lead to economic efficiency in many areas, reduce costs, save the need for intermediaries and optimize the way information is transferred between entities.”
More than 200,000 Israelis, according to the ISA, are investing in cryptocurrencies, and over 150 crypto businesses are running there.
Israeli authorities have recently expressed a greater interest in cryptocurrencies, and the national stock market plans to introduce a platform for digital trading assets.
In this week’s recommendation, the agency stated that the business had been severely harmed by high-profile failures, such as the demise of Celsius, which had sizable operations in Israel.
To expedite Israel‘s entry into the market, the Ministry of Finance decided to release several ideas for regulating digital assets in November. This recent move by the country’s securities watchdog is in response to those proposals.