According to Israeli business magazine Calcalist,
Israel's Capital Market, Insurance and Savings Authority is forcing insurance
firms and investment houses to explain and justify any bitcoin investments.
According to Calcalist, the authority described
bitcoin as a speculative asset with no inherent value in a letter issued to
banks under its supervision on Wednesday.
According to Calcalist, the letter was sent in
response to (and just a day after) the Tel Aviv Stock Exchange (TASE) and
digital currency investment firm Silver Castle announced the country's first
bitcoin-linked bonds will trade on TASE UP, the exchange's private company
trading platform.
The country's financial authorities have begun
strengthening crypto rules. The Ministry of Finance proposed a measure at the
end of July that would compel all crypto assets worth more than $61,000 to be
disclosed to the tax authorities. According to a newly published Justice
Department study, a new anti-money laundering order that includes virtual
currency service providers will take effect in November. According to the
Justice Department study, financial authorities, including the Capital Market
Authority, were engaged in the legislation's preparation.
TASE claimed the new bonds would expose
institutional investors to bitcoin “with substantially reduced operational
risks and product holding costs,” according to its release.
According to the press release, “the money generated
in the [issuance of the bonds] will be utilized exclusively for the purchase of
bitcoin, and the funds will be completely exposed to the bitcoin exchange
rate.”
By the time of publication, TASE and Silver Castle
had not responded to requests for comment.
The letter from the Capital Markets Authority,
according to Calcalist, focused particularly on bitcoin-related investments by
the institutions in issue, such as Altshuler Shaham's $100 million investment
in the Grayscale Bitcoin Trust earlier this year. It may not apply to all
crypto trading.
“To be clear, we are not discussing investments in cryptographic currencies in general, nor in related technologies, which have a different economic justification and may potentially benefit the market,” the letter said.
According to Calcalist, the authority will also ask institutions to provide minutes of all conversations and meetings in which they addressed these investments, as well as any supporting documents.
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