The Israel Securities Authority (ISA) has published a number of recommended directions for The ICOs to ensure a perfect balance between technological advancements and security of it’s users. The committee has been working on examining the ICOs and suggesting suitable regulations for the needed balance. The ISA Committee has also added their speculations regarding Bitcoins and whether it has the need of further regulations.
Bitcoins: A security or not?
“As a general rule, cryptocurrencies that are designed to be used exclusively as a medium of payment, clearing, or exchange and are not limited to a specific venture; that do not confer additional rights; and are not controlled by a central entity — will not be deemed securities”, stated the Committee.
Experts are considering the ISA Committee’s decisions since classifying the cryptocurrencies is a struggle, worldwide. Israel has catered to a lot of Innovations and has kept a significant leniency in it’s regulations. For instance, Unlike US Bitcoin ATMs, the Israeli ones do not ask for customer identification. All you have to do, is put in the fiat and take your crypto.
Ms. Anat Guetta said, that it is the circumstances and the feature of each cryptocurrency which decides whether it is to be considered a security or not.
The cryptocurrency which confers the rights similar to the traditional exchanges are securities. However, cryptocurrency which is not for investment and simply for the need of consumption, are not to be considered as securities.
The significant way to find out whether a cryptocurrency is a security or not is to check whether the token can be invested in secondary markets. If it cannot be traded, this will ensure that the Crypto was made for the purpose of consumption and not investment.
The report clearly ensures that the ISA Committee is looking forward to attempt a perfect balance of the Cryptos, tokens and ICOs and meet the needs of the consumers.