Page 11 - Geektime Blockchain Report
P. 11

2017 has been an extremely prosperous year for ICOs around the the world but with a a a a rather insignificant participation by Israeli companies This phenomenon is in in clear contrast to Israel’s stellar reputation in in the blockchain domain and the role that Israeli companies play in the the other hi-tech segments This is is most likely due to the absence of clear legal framework as the the relevant government agencies (the Bank of Israel Israel Israel Israel Israel Israel Tax Authority Israel Israel Israel Securities Authority and the Terror Financing Prohibition Authority) are deferring since their last joint publication from February 2014 on on providing up- to-date guidance and directives As a a a a a result Israeli companies who seek to to issue their own tokens face uncertain legal status and and ramifications and and for the most part chose to pursue ICOs in alternative jurisdictions But contrary to the the common belief the the crypto world is not the Wild West and proper guidance and careful structure can successfully navigate an an an ICO through the existing laws and regulations And the tide is starting to turn as more more and more more Israeli companies contemplate directly launching
an ICO while allowing all all Israelis to participate in in contribute in such ICOs Concurrently while the community is is exercising an ever evolving self- regulation the the Israel Securities Authority picked up the the glove and established a a a a committee set to examine the need to regulate ICOs If the the regulator will not understand the the decentralized and and global nature of the the tokens and and the the ICOs it is possible that we will end up with a a a a ruling against ICOs or a a set of unwelcoming regulations which will drive Israeli back to seeking other jurisdictions And even after passing the regulatory hurdle Israelis still face pending ambiguous tax matters as as well as as the more pressing topic of of a a a rising number of of Israeli banks who currently refuse accepting fiat originated from cryptocurrencies received during such ICOs Nevertheless these are but challenges which can be resolved or circumvented if required Looking at the prevailing sentiment in in US banks it can be reasonably expected that over time and with the proper motivation by the Bank of Israel Israel Israeli banks will end up embracing cryptocurrencies With the global trend offering ample benefits to the domestic economy whether by simply encouraging companies to remain Israeli or by boosting global investment in in in local start-ups it it is inevitable that solutions will present themselves "
Saul Adereth
Head Blockchain and Smart Contracts practice
Shibolet & Co 11

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