Crypto Firm Bits of Gold Obtains Capital Markets License from Israeli Regulator
Nicholas Otieno Sep 23, 2022 04:00
Bits of Gold is the first crypto firm to receive this license, which will enable it to work with local banks and financial institutions.
Bits of Gold, an Israeli-based firm engaging in crypto trading and brokerage services, announced on Thursday that it has obtained a license from Israel's financial market regulator, the Capital Markets, Insurance and Savings Authority.
With the license from the watchdog, Bits of Gold said it will be able to partner with local banks and financial institutions. The crypto firm said the license, along with the recent guidelines from Israel's central bank, will help resolve many issues associated with relationships between local banks and crypto.
The move makes Bits of Gold the first local crypto provider to obtain the license. The company said it applied for the license back in 2018.
Bits of Gold is preparing to develop a platform that will enable local and European banks and fintech firms to offer cryptocurrency services to customers. The company wants to start offering crypto custody services through its new digital wallet starting next month.
Is This the Beginning of Crypto Trading in The Country?
In the past, local banks had taken an ad hoc approach to accepting deposits tied to crypto investments. But that changed in November last year when the country’s capital market regulator approved Israel’s new anti-money laundering (AML) and anti-terrorist financing rules for crypto asset service providers. The rule cleared the way for local banks to more easily accept customers from the crypto sector.
The new AML rules cover the identification and verification of crypto recipients, reporting requirements for crypto companies, and the layout of a risk-based approach to dealing with money laundering.
In March, Israel's central bank published draft regulations that further opened up the country's financial system to crypto firms by requiring banks to examine the crypto firms individually rather than imposing blanket refusals on them.
In late March, Bank Leumi became the first Israeli bank to start facilitating crypto trade. Early this month, Israel's financial market regulator granted a first permanent license to a local private firm, Hybrid Bridge Holdings Ltd., to engage in cryptocurrency activities. As a result, Hybrid Bridge Holdings is now building a crypto custody and exchange platform.
In Israel, many firms seeking to engage in the crypto industry are still obtaining approval from the regulator.
In February, the Binance exchange came under the regulator's scrutiny over licensing issues. The watchdog ordered Binance to suspend marketing to Israeli users and stop all activities focused on Israel until the issues are addressed.
Image source: Shutterstock