CoinTelegraph reported:
A draft for the approval of an expansion of crypto trading activities to non-banking members has been published by the Tel Aviv Stock Exchange (TASE) for public comments.
In a TASE first, a Feb. 27 announcement stated the proposed structure will enable customers to deposit fiat money designated for investments in digital assets.
Non-banking members will act as licensed providers for crypto trading and custodial services should the proposal be approved. Customer funds will be placed in an “omnibus account” as the intermediary for crypto trading activities.
It will also allow clients to withdraw funds originating from the sale of crypto but the process is somewhat convoluted. This has been done to mitigate risks and enhance consumer protection, according to the announcement.
“This is another step in the advancement and development of the Israeli capital market that aims to encourage innovation and competition while mitigating the risks and protecting the customers.”
Once comments have been submitted, the proposal will be sent for approval by the TASE Board of Directors, however, no timeframe was provided.
Things may not go so smoothly for the Tel Aviv Stock Exchange and its crypto trading ambitions, however.
The regulatory outlook in Israel is becoming harsh for the sector as a proposed law plans to classify crypto assets as securities. In January, the Israeli Securities Authority (ISA) proposed a framework for regulating digital assets, placing them under the umbrella of securities.
In February, the CEO of Israeli crypto trading and custody firm Altshuler Shaham Horizon, Ilan Sterk, told Cointelegraph that the reclassification is “changing everything here,” and added, “it will kill the industry.”
Related: Proposed Israeli law to classify crypto as securities will hurt the industry, says crypto exec
The TASE announcement stated the current regulatory approach in Israel is to “impose regulation on financial activities or services in digital assets similarly to that currently applied to non-digital assets.”
However, the TASE remained confident, concluding:
“TASE believes that the alignment of local regulation with international regulation will attract more foreign investments and foreign investors into the Israeli market.”
In September, Israeli crypto exchange Bits of Gold became the first in the country to receive a license from the Capital Markets Authority.