Tel Aviv Stock Exchange To Regulate Crypto Trading After Turbulent 2022

The Tel Aviv Stock Exchange (TASE) is willing to allow clients of its non-banking members to trade cryptocurrencies.

The proposal comes as a result of last year’s turmoil in the industry, which many watchdogs said was a precondition for the imposition of stricter regulations.

Authorize NBMs

The TASE – Israel’s only public stock exchange – wants to expand the authorized activities of its non-banking members (NBMs) to allow customers to trade digital currencies. Examples of such entities are brokerage firms, insurance organizations, stock exchanges, venture capitalists and others.

The exchange recalled the 2022 cryptocurrency market crash and stressed the need to enforce a relevant regulatory framework on the industry.

The TASE proposal is aimed at protecting the customer. It allows traders to deposit fiat money into cryptocurrencies, while withdrawals can be made after non-banking members contact a licensed digital asset trading service provider and authorized custodian. In other words, the possible rule requires NBMs to buy and sell cryptocurrencies at the request of customers.

The Israeli exchange believes domestic regulations should be aligned with global ones to attract more foreign capital to the local financial ecosystem. Greenlighting NBMs to allow clients to trade cryptocurrencies could reduce risk in the sector, boost competition and bolster innovation, it added.

The marketplace displayed last October to establish a designated blockchain-based cryptocurrency platform that would focus on smart contract technologies and issue a variety of tokens.

CEO Itai Ben-Zeev said the exchange should see the light of day over the next four years and will be aimed at accelerating the development and adoption of fintech.

Israel to squeeze crypto into existing law

The Israeli Securities Authority (ISA) revealed earlier this year that it could amend three of its existing finance laws to include cryptocurrencies. The changes allow the watchdog to directly oversee the operations of digital assets and place them in the “financial instruments” category, where there are securities and joint investments.

The main goal is to provide Israeli crypto participants with maximum security and to emphasize the technological improvement of the industry. Like the TASE proposal, the ISA believes that embracing digital assets could bring numerous benefits to the local economy, including a flood of foreign investment:

“The advanced technology in these assets has the potential to drive economic efficiencies in many areas, reduce costs, eliminate middlemen and optimize the way information is transferred between entities.”