The supervisor of financial service providers and the Israel Securities Authority, according to the chief economist, should be given more authority to regulate the sector.
In order to safely increase crypto adoption, Israel’s chief economist has provided policymakers with a list of recommendations for how to approach the nation’s laws governing digital assets.
Shira Greenberg, the chief economist at the Ministry of Finance, advocated for a more thorough regulatory framework that would bring trading platforms and crypto issuers into compliance. And also increase the authority granted to its financial regulators in a 109-page report delivered to the Minister of Finance on November 28.
Israel should strengthen investor protection and certainty by requiring cryptocurrency issuers and trading platforms to obtain stricter licenses and by ensuring that funds derived from digital assets are managed more securely, , according to Greenberg.
Additionally, she suggested giving the Supervisor of Financial Service Providers more authority to oversee licensing regulations and create a more thorough taxation framework for the purchase and sale of digital assets.
Greenberg also advocated for the Israel Securities Authority to be given more authority, saying that such authority is necessary to determine whether a digital asset is subject to Israeli securities laws and to keep track of payment service providers’ activities in the cryptocurrency industry.
Greenberg mentioned the need for specific stablecoin issuer licensing and oversight rules, as well as the suggestion to create an inter-ministerial committee to review and manage blockchain-based decentralized autonomous organizations (DAOs), in terms of legislation.
She continued by saying it was critical that lawmakers and policymakers implement rules pertaining to digital assets while keeping in mind the idea of technological neutrality.
Despite Israel being frequently referred to as a technologically advanced country, the country hasn’t yet demonstrated a strong interest in cryptocurrencies, placing 111th out of 146 nations in a recent global cryptocurrency adoption index conducted by blockchain data company Chainalysis.
Additionally, according to data cited by Greenberg in her report, Israeli citizens have only been involved in 21 million blockchain-based transactions, or 0.04% of all crypto transactions worldwide.
Only 2% of Israelis claimed to own or use a cryptocurrency wallet, though.
The adoption rate seems to be increasing.