Professor Schmuel Hauser from the ISA finally discussed the authority’s concerns with ICOs.
The Israel Securities Authority (ISA) chairman, professor Schmuel Hauser recently delivered an address wherein which he outlined and discussed several concerns the regulating agency had regarding cryptocurrencies as well as initial coin offerings (ICOs).
Upon commencing his address, Hauser firstly discussed the difficulty of finding a distinction between cryptocurrencies and its underlying blockchain technology. Hauser was notably optimistic about blockchain technology’s future, however, and confirmed that the technology is likely to become an omniscient and powerful part of daily life in the future. The chairman stated that this will be the case, especially in the financial industry.
However, in regards to cryptocurrency Hauser preached caution and careful consideration. He noted that while cryptocurrency is dependent on blockchain the two are radically different. Hauser stated that to him, Bitcoin seemed like an investing bubble. Because of the risks involved, Hauser stated that the ISA is determined to ensure that cryptocurrency is safe for their users and not simply a dangerous new investment scheme.
According to the chairman, the ISA intends to assess each ICO on a case-by-case basis in order to establish the regulatory and legislative requirements and responsibilities of the industry. Hauser did confirm that the ISA has no intention of enforcing an outright ban on ICOs.
According to Hauser, those ICOs which are considered to act as a security will be subject to the ISA’s regulatory policies. However, if an ICO is categorized as a cryptocurrency, it will not have been regulated by the authority. Hauser did note, however, that the latter rule could change depending on certain corporate laws.
According to Hauser, one of the ISA’s main concerns regarding ICOs is the industry’s inherent lack of transparency. While Hauser acknowledged the industry’s significant contribution to the evolution of the financial sector, he cautioned that proper and regulation and management is imperative when dealing with ICOs.
In September earlier this year, the ISA put together a committee in order to review the need for ICO regulations within Israel. This committee was also tasked with determining whether ICOs should be compliant with securities regulations. While the committee is scheduled to deliver their recommendation on 31 December. Hauser’s latest address seemed to confirm the general trajectory of the committee’s impending decision.
