Cryptocurrency exchanges and exchangers often consider Israel as a promising jurisdiction outside the European Union, constantly making the requirements for the crypto-field more rigorous.
The government and the local regulator are preparing draft laws regulating the use, exchange, and circulation of non-fiat currencies, but so far they consider Bitcoin and other cryptocurrencies to be a property/asset, but not a payment instrument. It is expected that ICO and crypto business will be fully introduced into the Israeli legal field – with the registration of licenses for cryptocurrency, etc. In the summer of 2018, a law on financial services vendors entered into force in the country, which included provisions for digital assets and firms engaged in their exchange.
In compliance with the updated standard, exchangers and exchanges providing an access to cryptocurrencies must comply with the requirements for money laundering countering:
- report on suspicious client transactions, including those performed using Zcash and Monero;
- keep documentation, including e-wallet addresses, IP, and number of crypto-instruments, for at least 5 years;
- comply with international AML / KYC standards, etc.
Many firms from the crypto-sector work legally in Israel. Prifinance consulting company will help to develop a legitimate, promising business, select a corporate scheme and issue a license for the cryptocurrencies exchange.
We also want to provide brief tax highlights you should keep in mind while considering this jurisdiction. In Israel, the seller should pay a tax of 25% after selling cryptos. Also, miners and Bitcoin traders are considered as businesses and are obliged to pay 17% VAT and corporate tax related to the conducted transactions.
Prifinance is your assistant in registering and licensing of cryptocurrency business
If you want to document a license for the cryptocurrency exchange, our experts will provide legal, technical, and organizational support and develop an action strategy. Precisely, our lawyers can, among others:
- select a jurisdiction (Israel or any other option that can be more suitable for your business goals), corporate and tax scheme for the client’s task;
- prepare, legalize a package of documents for a legal entity registration in a suitable form and submit it to the state bodies;
- open a bank account (for work, crypto-transactions) in Israel or any other jurisdiction as this may be suitable;
- get a tax number;
- prepare a business plan with the funding substantiation, documentation for meeting the requirements of AML/KYC legislation – user agreements, policies, internal control regulations, descriptions of hardware and software for protection of client data and transactions, etc.
Prifinance specialists can facilitate the process of getting a license for cryptocurrency and deploy a legitimate, promising business. Reach us shortly for more precise advice and suggestions.