A major victory must have been won by Bits of Gold in its case against Israel’s Bank Leumi.
For several years Bank Leumi had sued Bits of Gold, a Bitcoin and cryptocurrency that its activities open the bank to certain risks. The bank received a ruling to close all the accounts of the exchange.
However, Israel’s Supreme Court said in a ruling that the risk identified by Bank Leumi might be overrated given the facts that Bits of Gold’s activities are not showing any form of negative impact on the bank.
The Supreme Court said in its ruling that: “It appears that the damages that the bank might incur are mere speculations for now. The decision of the bank is based on the assumption that the company’s activity indeed carries risks that arise in violation of the provisions of the law, and therefore the bank is liable to pay a price for the materialization of those risks. However until now, for more than five years in which the account has been operating, these fears have not materialized – as the District Court has determined that the company acted transparently and did not violate any statutory provision.”
Israeli Supreme Court Forbids Bank From Denying Service to Bitcoin Exchange“This is a precedent-setting decision whose importance can not be overemphasized in relation to the trading of digital currencies,” said lawyer Shaul Zioni of the legal firm who represented the company. “The court says banks actually can not ban the company’s activities sweepingly and that they should manage their risk.”
Yuval Roash, CEO of Bits of Gold said: “The court’s decision enables us to focus on continuing to establish the crypto community in Israel, and we will continue to lead the field in order to give digital coins the place which they deserve in the Israeli economy – as a tremendous growth engine for hi-tech and the financial industry. ”
Bank Leumi responded: “The bank respects the decion of the court. However, as long as the matter is not regulated by orderly regulatory directives, the bank’s exposure to the client’s activity in bitcoin will be valid – and not only towards the regulators in Israel who are obligated to respect the decisions of the Supreme Court, but also towards foreign regulators who do not consider themselves bound by the decisions of Israeli law. Therefore, as long as no binding legal provisions are determined by the regulator and the relevant parties, the bank will continue to manage the case until the temporary injunction is removed. ”