Israel is looking to blockchain technology to help shape the future capital markets. Chairman of Israel Securities Authority (ISA), Anat Guetta, has announced plans to collaborate with fintech innovation to assist in regulating the fintech and crypto sectors. This initiative continues the announcement made two years ago to create “a complete digital value chain for investors.”
On February 14, in an interview with CoinDesk, Anat Guetta stated, “We see crypto and blockchain as two separate phenomena. We see great potential for blockchain technology. Crypto activity is a separate issue that we are examining and considering how it should be supervised in a holistic way in Israel, as it should be in other areas in the world.”
Within this interview, Guetta acknowledges that regulations around technology are lagging and that Israel will move toward a more balanced, monitored, and regulated space with the involvement of the ISA.
Crypto assets are crucial for the blockchain ecosystem. Blockchain technology is related to financial innovation. Israel has acknowledged the need to embrace technology and its developments to move forward. In 2020, in her address to a Securities Conference, Guetta explained, “We are also the first regulatory agency in Israel — and one of the first in the world — to adopt DLT technology in its core systems, the systems that are used to provide services to the public.”
For the sake of clarity, Israel requires regulations for industry players (what is permissible and what is now?). In Guetta’s interview with CoinDesk, she inferred the reality that blockchain companies often chose to operate outside Israeli parameters, which wears on Israel’s economy and the country as a whole.
There needs to be a comprehensive and coherent regulatory framework for institutions to operate no matter the jurisdiction. Israel is taking steps forward in this regard.