One of the toughest financial regulators in Israel
has made some surprisingly positive comments
today regarding the acceptance of ICO
crowdfunding and cryptocurrency. The outgoing
chairman of the Israel Securities Authority (ISA)
talked about a need to foster the creation of an
international financial center based on ICOs.
Also read: Reports of Israeli ICO Ban Are Fake
News, Entrepreneurs Look to Create ‘Crypto
Nation’
Prof. Shmuel Hauser, Outgoing ISA Chairman
Speaking for the last time as the ISA head
before the Israeli corporations conference, Prof.
Shmuel Hauser discussed the main challenges
that the regulatory body still faces. Regarding
ICOs he said:
“We will have to bring order to the market. Some
countries decided to examine digital tokens on a
case by case basis. A small number decided to
ban them. We have decided to find out, with a
team headed by the chief economist and the
head of the corporations division, under which
terms is it a security? Coin? Or some hybrid I call
a security-coin?
“The team is meant to file its report by the end
of December. We will have to define for
ourselves and the market what is this beast.
Among other things, we will need to consider
expanding the supervision on security-coin and
define a proper regulatory framework, different
from the one we know for IPOs.
“I believe that the topic of digital currencies and
their offerings must receive a favorable
regulatory response, maybe even daring
somewhat, to give a chance for the option to
develop an international financial center for
security-coin from the type of ICOs.”
Still, the professor added that the regulatory
framework will need to show a certain degree of
paternalism to make sure ICOs won’t develop in
directions he considers to be negative.
ICO Nation
Though they had very little to do with its
development, Israeli politicians and high-ranking
bureaucrats often pride themselves in the
country’s ‘Startup Nation’ status.
About 5,000 high-tech startups are estimated to
be operating in Israel at any moment. Most of
them fail to mature due to local VCs allowing
them very short growth periods before pressuring
them to sell out or pulling the plug. ICOs could
help fill this much talked about gap between
seed funding and full blown IPO.
If regulators were to just step back and refrain
from suffocating the nascent ICO scene in Israel,
it is expected that a thousand ICOs could be
launched in the country in 2018.
How should Israeli regulators promote ICO
projects in the country? Tell us what you
think in the comments section below.