Leumi becomes the first Israeli bank to offer crypto trading

TL;DR Breakdown

• Israeli`s Bank Leumi approves crypto trading.
• Banks worldwide start to embrace crypto services and blockchain innovations.
• Israel gears up for crypto adoption.

According to reports, Bank Leumi, an Israeli bank, will enable crypto trading and become the first in the country to allow such trading activity. On March 24, Pepper Invest, the bank’s digital platform, announced that it would collaborate with Paxos to provide the service. Bank Leumi is Israel’s second-largest financial bank after Bank Hapoalim.

Leumi starts offering crypto trades

According to a Thursday report from Reuters, Bank Leumi will allow customers to trade and store Bitcoin (BTC) and Ethereum (ETH). Customers will be able to trade the cryptocurrencies assets as mentioned above initially in transactions starting at least 50 shekels ($15.49). However, the press release did not give an expected launch date for the new service.

It remains to be seen whether the takeover will go through. Regulators have not yet approved the move, so it could still fail. According to Pepper Invest, transactions will be taxed according to Israeli Tax Authority rules, so customers won’t have to worry about tax issues.

In a cited statement the report stated, “Pepper will collect tax according to the guidelines of the Israeli Tax Authority so that customers will not need to manage tax complexities.” 

It’s unclear whether Leumi’s financial move will influence other Israeli banks, but it certainly appears to be a step in that direction. More information should become available in the coming weeks. Approval from regulators will be crucial, and Israeli authorities are quite strict regarding cryptocurrency trading. Following a request from Israel’s financial regulator, Binance has suspended operations.

Israel is also interested in ensuring that cryptocurrencies don’t get misused for illegal activities. The Defense Minister of Israel banned 12 cryptocurrency accounts linked to terrorist organizations following the stand. As a result, any banks or firms wanting to provide crypto services must first comply with anti-money laundering (AML) laws.

Banks begin to embrace crypto payments

Banks have gradually warmed to the prospect of integrating crypto features on their platforms. For a long time, they’ve been hesitant, with some even disparaging the market and calling it a fad. However, at the moment, small banks and big institutions alike are diving into crypto.

Bank Leumi’s decision is not a surprise to investors across the globe. The bank’s decision follows the example of a small number of banks across the world who embraced crypto trading and blockchain innovations. It was a first for Australia when the Commonwealth Bank announced in November 2021 that it would allow its clients to trade cryptocurrency on its platform.

According to a Cryptopolitan report, Australia and New Zealand Bank (ANZ) became the first Australian bank to create stablecoins. The Australian bank created 30 million Australian Dollars stablecoins (A$DC), minted using an ANZ-developed Ethereum Virtual Machine (EVM) through the Fireblocks platform.

Similarly, authorities are hesitant not to overlook the benefits of decentralized technologies. Israel is working towards adopting and regulating cryptocurrency. In the second week of March, Cryptopolitan reported that The Bank of Israel had released proposed regulations that might open up the country’s financial system to cryptocurrency firms.

They’ll have to study each firm separately rather than applying blanket rejections, which will make it much more difficult for them to avoid mistakes. Israeli banks must now determine the origin of the money used to acquire cryptocurrency. Furthermore, they must detect the route of virtual currency from one individual to the next during its purchase and conversion to fiat money and its deposit into a bank account.