Israel’s Central Bank: Cryptocurrencies are Assets, Not Currency

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Bank of Israel Deputy Governor Nadine Baudot-Trajtenberg sought to clarify the central bank’s position on digital currency Monday, in remarks offered at a parliamentary finance committee meeting. According to a Reuters report, she said that the central bank does not recognize cryptocurrencies as currencies:

“The Bank of Israel’s position is that they should be viewed as a financial asset.”

Baudot-Trajtenberg addressed several cryptocurrency-related issues in her remarks, including public complaints about Israeli banks that have been reluctant to allow clients to use their accounts for Bitcoin purchases. She suggested that the central bank could offer no solutions for those customers, and that Israel’s government had no legal obligation to help digital currency investors.

The Deputy Governor did confirm that the Bank of Israel is continuing to investigate cryptocurrency matters, though she noted that there were few global examples for the bank to study. To date, the world’s central banks have yet to even attempt to regulate the banking industry’s interactions with the digital currency space. According to Baudot-Trajtenberg,

“There is a real difficulty in issuing sweeping guidelines to the system regarding the proper way to estimate, manage, and monitor the risks inherent in such activity. Beyond the risks to the customer there are also compliance risks to the bank.”

Committee members who attended the meeting reportedly called on the nation’s regulators to craft a regulatory framework to help provide guidance for the industry. The panel’s chairman, Moshe Gafni, asked regulators to provide the committee with regulatory ideas within the next month.

 

The views expressed by the authors on this site do not necessarily represent the views of DCEBrief or the management team.

Author: Ken Chase

Freelance writer whose interests include topics ranging from technology and finance to politics, fitness, and all things canine. Aspiring polymath, semi-professional skeptic, and passionate advocate for the judicious use of the Oxford comma.

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