The state of Israel’s top financial services regulator, Israel Securities Authority, ISA said Bitcoin is not an investment security.
The conclusion was reached by the ISA’s Special Committee for the Examination and Regulation of Initial Coin Offerings (ICOs).
Th ISA said the aim of the committee was to “recommendations designed to dispel uncertainty and strike a balance between technological innovation and the protection of the investors.”
In its findings and submission, ISA said:
“As a general rule,” the ISA Committee revealed, “cryptocurrencies that are designed to be used exclusively as a medium of payment, clearing, or exchange and are not limited to a specific venture; that do not confer additional rights; and are not controlled by a central entity — will not be deemed securities.”
However, this does not mean that the ISA will ban the use of Bitcoin as a means of payment in the country.
The ISA said: “The question of whether a cryptocurrency should be considered a security will be decided on the totality of the circumstances and features of each case in accordance with the purposes of the law,” the report detailed. “As a general rule, cryptocurrencies that confer rights similar to the rights conferred by traditional securities such as shares, bonds, and participation units, will be deemed securities. In contrast, cryptocurrencies that represent rights to a product or service and are acquired solely for the purpose of consumption and use and not for investment purposes, will not be considered securities.”
