Bank of Israel (BoI) Pushes Banks to Accept Crypto Profits

Richard Marley
December 31, 2021
3 minutes read
2245

The Central Bank of Israel pushes local banks to un-restrict the cryptocurrency transaction generated from legit sources.

Local banks are instructed by the Bank of Israel to accept profits gained from cryptocurrencies trading and investment schemes as long as the source of income is legitimate. The process is intended to fulfill Money Laundering Prohibition Ordinance (MLPO) which applies to digital assets and virtual assets service providers.

According to the local report, the Central Bank of Israel has sent a daft to the banks with a supplement to Proper Banking Procedure 441. The document mainly focused on money laundering and numerous other financial crimes.

The legislative directive aims to enhance the cryptocurrency regulation and hence assist banks to carry out risk assessments when transferring or receiving virtual currencies. Particularly, the draft represents strict instruction from BoI to every type of financial firm, that they may no longer restrict cryptocurrency transactions from individuals or the virtual assets service providers.

BoI tells banks they can’t refuse crypto transactions: The Bank of Israel has distributed a draft procedure on money laundering precautions in connection with digital currencies. https://t.co/SyI1HzmXJ9 Globes pic.twitter.com/uvZants2sL

— Jewish Community (@JComm_NewsFeeds) December 30, 2021

However, there are several sets of standards and details that banks are obliged to comply with before processing cryptocurrency transactions. It includes the source of income, funds legitimacy, the size of the transaction, and the risk classification.

While briefing on some emerging risk concerns that still present in the initiative, Ron Tzafrati, VP of Finance and Regulation at the Israeli crypto exchange Bit2C, said:” On the one hand, the Bank of Israel finally recognizes the obligation of banks to perform a risk assessment and management and not to refuse in a sweeping manner the transfer of funds by the Bank’s customers in connection with digital currency activities. On the other hand, the bank leaves broad discretion to banks to continue to refuse in many cases, which do not really create a real risk of money laundering.”

A month ago, the Israeli financial watchdogs made public that they will impose new laws for the cryptocurrency sector, which will, however, limit the use of Bitcoin and Altcoins in suspicious financial activities. According to the initiative, every type of digital currency institution will have to create risk assessment reports, meaning they are to be regulated as the banking sector.

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ASIC Expands its Team to Enhance Cryptocurrency Regulations
Australia’s financial regulator has enhanced the size of its crypto team. The crypto regulatory measures include their application for financial services licenses and show that specific crypto platforms have particular liquidity in reserve.

After shifting popular blockchain from a proof-of-work (PoW) to a proof-of-stake (PoS) system, ASIC, Australia’s financial regulator, has increased the size of its crypto team.

U.S. Security and Exchange Commission Chairman Gary Gensler stated that PoS-based tokens might be classified as securities.

The decision of ASIC to keep PoS tokens for example Ethereum, Cardano and Solana under its remit will further clarify the situation and enable crypto regulations to be more effective. To cope with the latest regulatory reforms, the crypto exchange must either delist the tokens or start complying with robust crypto laws.

Such moves may force a few crypto firms to manage their operating models. Even the largest stablecoin of the crypto market, Tether, has been caught in a controversy created over the failure of holding enough dollar reserves to back the stablecoin.

The crypto regulatory measures include their application for financial services licenses and show that these platforms have particular liquidity in reserve.

The final decision by the regulator has not been issued yet. Greg Yanco, the executive director for marketers, said that ASIC won’t be a “cheerleader for crypto assets.”

SEC Newgate carried out research the last November. It showed that 44% of Australian retail investors reported holding crypto. Out of these investors, only 20% viewed crypto as high-risk.

The chairperson of ASIC responded and said that the regulators were “concerned that there are limited protections for crypto-asset investments given they have become increasingly mainstream and are heavily advertised and promoted. There is a strong case for regulating crypto-assets to better protect investors.”

According to Yanco, until the last year, cryptocurrency was not such a high priority. Still, due to the decline of cryptocurrency in the previous few years and investors wiped out around the globe, ASIC expanded its team. It made crypto one of its “core strategic projects.”

Suggested Read: Regulatory Authorities to File a New Bill to Secure the Citizens from Cyber Criminal Activities

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Forensic document verification involves incorporation of scientific rules in examining the authenticity of records. There are experts in this field who carry out all the operations using specialized methods. Nowadays, the use of forensics is rising, especially in courts where no document is accepted without authentication. By using several techniques like handwriting identification, ultraviolet light sources, microscopes, photography, and infrared imaging in the laboratories, a document is verified. All the major jurisdictions have formed dedicated institutions which overlook the process of document verification. The American Board of Forensic Document Examiners (ABFDE) is the primary authoritative body responsible for monitoring forensic operations in the US, and any person carrying out these activities anywhere in the country must be a member of this board.

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Canada

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Want to know more about forensic forgery analysis of documents for digital businesses?

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Bank of Israel (BoI) Pushes Banks to Accept Crypto Profits

Forensic Document Verification – A New Standard

How Forensic Document Verification is Carried Out?

High-Profile Crime Cases of Document Fraud

Gang Arrested for Printing Fake Documents in Greece

Criminal Network Busted for Distributing Fake Documents

Regulatory Authorities Monitoring Document Fraud

Canada

Australia

Document Forgery Forensic Authentication – Ensuring KYC Compliance

What Shufti Pro Offers?

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Let’s prove your customer’s

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