The Israeli Central Bank (Bank of Israel) and the Ministry of Finance recognize the growing popularity of cryptocurrencies in their own country. Since the rapid price hike last year, Israel has been thinking about a government-sponsored cryptocurrency.
Officials at the Ministry of Finance want to use a government-approved cryptocurrency to save cash in their own country while tackling tax evasion and money laundering. The black market in Israel is estimated at about 22% of GDP. Since the beginning of 2018, the concept has been a government subsidized digital currency, the & # 39; crypto-shekel & # 39 ;.
Cryptocurrencies popular in Israel
Cryptocurrencies and Blockchain are on everyone's lips, thanks to the multitude of patents and the technologically advanced industry in the country. Israel was recently ranked as the tenth most innovative country in the world. Therefore, some believe that a crypto-based solution against tax evasion and money laundering could not be developed by a government-recognized cryptocurrency, but by the private sector.
A number of leading banks in the country have joined forces with the government in the world of digital currency & # 39; s. The Bank of Hapoalim is working with Microsoft Azure to use blockchain technology to digitize assets.
In February, the Supreme Court of the country ruled that Bank Leumi should lift the restrictions on the account of the crypt exchange Bits of Gold until a full sentence has been reached that could last for years. Attorney Shaul Zioni said the sentence is an important precedent because the Supreme Court essentially decided "that there is no ban on trading in digital currencies."
Strong future for cryptocurrencies?
Government-approved cryptocurrencies have already been implemented, with Russia and Venezuela taking the lead. Digital currencies in Israel, however, still have some hurdles ahead. Currently, digital currencies are subject to a tax rate of 46 percent on profits for companies and 25 percent on profit for individuals. The high tax rates can of course hinder the future growth of the market.
In addition, the Israeli tax authorities concluded an agreement with the local Bit of Gold Stock Exchange in July to obtain information on important deposits and information on suspected cases of tax evasion and money laundering. Some, however, see this agreement as a positive sign of regulation.