February 27, 2018 8:23 PM
A temporary decision against Bank Leumi by the Israeli Supreme Court is meant to prevent banks from barring payments to exchanges.
On February 26, 2018, a temporary order passed down by the Israeli Supreme Court will prohibit Bank Leumi, a corporate outfit with 250 branches across Israel, from putting limits on accounts associated with cryptocurrency.
The action from the court rebukes a December 2017 decision by the bank to block payments to the Bits of Gold cryptocurrency exchange. Although the order is temporary, the Supreme Court may be setting a precedent for regulation.
Bits of Gold CEO Yuval Roash spoke of his company’s leadership role in seeking fair regulatory measures:
“The court’s decision enables us to continue to focus on the base of the crypto community in Israel. We were the first to request the creation of rules for the activity of digital currencies and the first to stand by those rules. We will continue to lead the industry, in order to give digital currencies their rightful place in the Israeli economy, as an incredible growth engine for the high tech and financial industries.”
Bank Leumi had previously cited a Bank of Israel order aimed at prohibiting payments for internet gambling as the reason for its decision, as bitcoin exchanges had been classified as gambling sites by the central bank.
Judge Anat Baron said the Supreme Court’s decision “is not intended to harm the bank’s rights to analyze with specificity every transaction that takes place with the bank account or to take any actions that are related to minimizing risks, which become transparent through the activities of the company.”
Under current regulations, Bank Leumi still has the option to restrict the accounts of customers on a case-by-case basis that it identifies as transacting with a cryptocurrency exchange; technically, the bank has a way to get around the Supreme Court’s order.
Officials from various branches of Israel’s government have been weighing how to approach cryptocurrencies. Earlier this month, the Israeli Tax Authority reported that it will regard them as property for tax purposes. In December, the central bank announced it was considering a state-issued digital asset.
Jeremy Nation is a writer living in Los Angeles with interests in technology, human rights, and cuisine. He is a full time staff writer for ETHNews and holds value in Ether.
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Published at Tue, 27 Feb 2018 19:39:36 +0000