The state of Israel is now the latest country to clarify the status of Bitcoin, with the nation’s highest court now ruling that the world’s foremost cryptocurrency is in fact, an asset and not a currency.
This does signal the acceptance and adoption of Bitcoin as a mainstream digital store of value, but not so much as a form of payment, just on the back of the Israel central bank passing down the same decision. In his ruling, Judge Shmuel Bornstein stressed that the legal entity had chosen to use the same interpretation, declaring that:
“The Central District Court in Lod accepted the tax authority’s interpretation, and held that Bitcoin is an asset and not a currency, and that the transaction in question is therefore taxable.”
While the immediate practical meaning of this ruling simply means that Bitcoin would be taxable in the country, some local commentators, such as Itay Bracha, Managing Partner at Israeli legal firm Bracha and Co. Bracha saw this declaration as a warning:
“The ruling is a signal to all those who have yet to report cryptocurrency-related profits or based their actions on differing legal advice… The ruling is unequivocal, and since it is not new legalization but a judicial interpretation, it applies retroactively.”
Back in March, the Israel Securities Authority (ISA) had recommended its latest findings on a draft regulatory framework for the cryptocurrency industry.
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