The post <strong>Tel Aviv Stock Exchange Looks to the Future with Cryptocurrency Trading License Application</strong> appeared first on Coinpedia Fintech News
The Tel Aviv Stock Exchange (TASE) is seeking approval from regulators to facilitate crypto trading on its platform. This move comes after last year’s decision by Israeli banking institutions, like Bank Leumi, to offer crypto trading facilities in agreement with Paxos. The draft for public comments published on Monday, February 27, seeks to expand the authorized activities of Non-Banking Members (NBMs) to include trading in cryptocurrency.
Regulation is Needed
The cryptocurrency market has experienced turmoils over the past year, bringing material changes in crypto activity as more regulated institutions take part in this activity.
The turmoils emphasize the need for regulation in this sector, in view of the rapid development of the cryptocurrency sector over the recent years and the greater involvement of customers in this sector.
As a result, there is a growing demand from customers to transfer money originating from this activity into their accounts. This requires regulation that will mitigate the various risks (operational, legal, cyber, and other) that are inherent in the crypto activity.
The proposed structure will enable customers to deposit money (Fiat money) designated for investment in cryptocurrency and withdraw monies originating from those currencies.
The NBM will contact two functions – the first, a licensed provider of cryptocurrency trading services, and the second, a licensed provider of custodial services for those currencies.
In order to purchase cryptocurrency, the customer will deposit monies in traditional currency (NIS or foreign currency) (Fiat money) that will be deposited in an omnibus account of the NBM with the provider of the trading services.
Upon receiving an order to buy virtual assets from the customer, the purchase will be executed using the money deposited in the omnibus account and recorded in the customer’s account with the NBM.
When the customer gives the order to sell crypto, the provider of trading services will sell the coins and credit the NBM’s omnibus account by the amount of consideration received, and the consideration will be transferred into the customer’s account with the NBM.
The report, “Regulation of the Digital Assets Sector – Roadmap to a Policy,” published by the Chief Economist in the Ministry of Finance last November, indicates that the current regulatory approach in Israel, and in certain other countries, is to impose regulation on financial activities or services in digital assets similar to that currently applied to non-digital assets, taking into consideration the non-traditional and unique characteristics of this sector.
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