Israel's Central Bank Approves New Rules for Crypto Transactions
Translated & summarized from NEWSru Israel by baba
The Bank of Israel has finalized new regulations for banks handling cryptocurrency funds, effective May 1, 2027. Banks can no longer automatically reject crypto-related funds and will assess transaction risks individually instead of using a fixed monetary threshold for enhanced scrutiny. Simplified checks will apply to funds from licensed Israeli or low-risk foreign crypto firms, while high-risk transactions will still require deep investigation. The central bank will review the system's effectiveness after five years.
The story in 6 lines · by baba
- Israel's central bank has finalized new rules for banks handling cryptocurrency funds.
- The new regulations will take effect on May 1, 2027.
- Banks can no longer automatically reject funds solely due to their crypto connection.
- Transaction risk will be assessed individually, replacing a 100,000 shekel annual threshold for scrutiny.
- Simplified checks will be allowed for funds from licensed Israeli or low-risk foreign crypto firms.
- High-risk crypto transactions will still require thorough investigation.
The Bank of Israel has finalized new regulations governing how banks handle funds derived from cryptocurrency operations. These rules are set to take effect on May 1, 2027, following a period of public consultation on a draft released in July. A key provision removes the blanket prohibition on banks automatically rejecting funds solely because they are linked to virtual currencies. Additionally, the existing requirement for automatic scrutiny of fund sources and "crypto routes" for transfers exceeding 100,000 shekels annually will be abolished. Instead, banks will be mandated to assess the risk of each transaction individually.
Under the new framework, banks may conduct simplified due diligence or forgo full verification of the "currency route" if funds originate from a licensed Israeli crypto firm or a regulated foreign company from a low-risk country. Conversely, transactions involving anonymous wallets, crypto mixers, high-risk jurisdictions, or unusual transfer patterns will still necessitate thorough investigation. Compared to the initial draft, the final regulations provide clearer requirements for crypto companies and those raising capital through token issuance, along with updated client notification procedures. The Bank of Israel plans to evaluate the effectiveness of this new system five years after its implementation.
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