RegAlertIsrael: crypto & digital assets regulation
Partially regulatedIsrael: No specific crypto licence; banks restricted under BoI directives
- Lead regulator
- Bank of Israel
- Also involved
- ISA (securities/tokens) · Israel Money Laundering and Terror Financing Prohibition Authority (IMPA) (AML)
- Core law
- Proper Conduct Directive No. 310 (2023)
- Entry capital
- —
- Approval timeline
- —
- Customer assets
- No specific custodial licence; general fiduciary duties apply
- Data protection
- Privacy Protection Law 2018 · Israel Privacy Protection Authority
- Sandbox
- No
Israel lacks a dedicated crypto licensing regime. The Bank of Israel (BoI) governs the banking interface via strict directives (310 and 411), requiring banks to exercise utmost caution and enhanced AML/CFT controls. The Israel Securities Authority (ISA) regulates token offerings as securities. General business laws apply to non-bank crypto entities.
Which licence do you need?
| Your activity | Requirement | Capital | Timeline | Authority |
|---|---|---|---|---|
| Exchange / trading platform | Uncertainverify with regulator No specific licence; banks restricted from direct service | — | — | — |
| Custody of client assets | Uncertainverify with regulator No dedicated custody regime; general fiduciary standards | — | — | — |
| Token issuance / public offering | LicenceSecurities Offering Permit Treated as securities if investment contract characteristics met | — | — | Israel Securities Authority (ISA) |
| Broker-dealer / OTC desk | Uncertainverify with regulator If dealing in securities, ISA regulation applies | — | — | — |
| Stablecoin issuance | Uncertainverify with regulator No specific stablecoin framework; general payment rules | — | — | — |
| Crypto payments acceptance | Uncertainverify with regulator Banks restricted; non-banks face general payment scrutiny | — | — | — |
| Mining / staking services | Unregulated Generally unregulated unless involving securities | — | — | — |
| Advisory / portfolio management | Uncertainverify with regulator ISA regulation if advice concerns securities | — | — | — |
New — what changed recently
- 2023-02-26BoI Circular C-06-2741 — Amended Directive 310 to require utmost caution and enhanced risk management for crypto assets by banking corporations.[1]
- 2022-05-09BoI Directive 411 Amendment — Imposed enhanced AML/CFT controls and periodic risk assessments for banks handling virtual currency transactions.[2]
Market-entry checklist
- 1Assess ISA securities statusDetermine if tokens qualify as securities under ISA guidelines to trigger permitting requirements.
- 2Engage regulated bank partnerSecure banking relationships aware of BoI Directive 310 restrictions on crypto exposure.
- 3Implement IMPA-compliant AMLRegister with IMPA and establish robust AML/CFT frameworks per BoI Directive 411 standards.
- 4Structure corporate entityIncorporate in Israel and obtain standard business licenses; no specific crypto entity license exists.