Israel’s Ministry of Finance Works to Arrange Licenses for Blockchain Companies
The Capital Market Authority is working to quickly arrange licenses for fintech companies in Israel, with the aim of encouraging competition in the local market. As part of this process, dedicated industry teams have been set up, with some of them specializing in blockchain companies and others in fintech companies. There are currently 2,000 different entities that apply for a license from the authority in various fields and the authority intends to prioritize blockchain and financial technology.
A preliminary check conducted by the ISA found that there are now at least dozens of companies that can obtain a work permit in Israel, with minor changes to their business model and technology. This is not the first attempt to advance the fintech industry in the country; In 2017, they started working on a controlled environment (Sandbox) concept, in which everyone involved in the fintech industry participates in order to create a uniform framework for them to obtain licenses and speed up treatment in the field. This initiative has not taken off since that year, as most startups do not even see a target market in Israel, being small and regulated.
In addition, the Authority published a document in the area of investment facilitation in non- short-term projects (insurance technologies), in which the Authority seeks to identify barriers that make it difficult for insurance companies to invest in such initiatives and the investment of companies in developing appropriate infrastructure. The authority seeks to obtain the industry’s position on easing options in the solvency to repayment regime, easing investment regulations and other steps that may help develop the Israeli fintech industry, such as mechanisms for encouraging innovative developments in the Israeli insurance industry for promotion as a beta site.
The authority has recently joined GFIN, which is an international network for promoting financial innovation, including about 30 financial regulators and international bodies, including the IMF and the World Bank, which are committed to supporting financial innovation. GFIN aims to establish a controlled framework for sharing practical knowledge between leading regulators in the world.
Last April, the Authority also participated as a single Israeli representative at a roundtable organized by the International Monetary Fund (IMF) on fintech and virtual currencies.
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