Governments around the globe have developed a different stance towards blockchain applications and cryptocurrencies. While some countries have issued heavy regulations (China, the United Arab Emirates or Colombia), others like Malta, Switzerland, and Israel have embraced the possibilities.
Israel Blockchain Scene
Israel keeps a unique position in our world, as one of the key players in cryptography, fintech, and software. It has also been claimed as the World’s Startup Nation, so it is not surprising that blockchain technology has been quickly developing in an innovative environment. According to the latest reporting from the Israeli Blockchain Association, there are already over 200 blockchain startups in Israel. Most of them are focused on fintech and core infrastructure, while the security sector is showing the most growth with 23 participants at the moment. It is also noteworthy that since the beginning of the year only 20 associations have closed operations.
While 2017 has been a year of ICOs, the outcomes were far from optimal- 80% of ICOs have been identified as scams, and barely any ventures brought success. Thus in 2018, we see a rise in institutional investments in Israel blockchain startups.
“The Israeli blockchain industry is currently experiencing both a boost and a transformation. On the one hand, we see unprecedented growth among blockchain start-ups, but on the other hand, many of them are skipping ICOs in favor of equity financing. Today there are fewer startup founders coming out of morally questionable markets, such as Forex, binary trading and gambling. Instead, more institutional players are starting to enter the market. Thus, the market is going through a self-purification.” said Roman Gold, founding partner of the Israeli Blockchain Association to Forbes.
The growth of the blockchain sectors greatly depends on the surrounding regulations. Israeli lawmakers have been quick to adapt to the requirements of the blockchain market, and are closely collaborating with blockchain professionals.
This year in March the Israel Securities Authority released their “Interim Report on the Regulation of Decentralized Cryptocurrencies,” and the next wave of regulations is expected to define regulations around cryptocurrencies as financial assets.
The Israeli Blockchain Association has also met with the Israeli Tax Authorities, where the Israeli Tax Authority has ensured to form clear regulations, keep constant cooperation and encourage other government agents to support the expansion of the blockchain industry.
Israel is showing the world again, that when it comes to innovation, they are first in line. We have already seen widely successful startups rising from Israel: Waze, Wix, Gett, Argus Cyber Security, to mention a few. Combining this inspirational environment with the possibilities of blockchain is expected to bring us a new wave of cutting-edge applications. We are also glad to see one more government, which realizes the potential in blockchain, and is aiming to support the growth of technology and new ventures actively.