The Israeli financial regulatory authority has taken decisive action against cryptocurrency exchange Bitin, ordering its immediate closure for operating without a licence in the country. Additionally, the platform’s operator is facing a hefty financial sanction of approximately 1.7 million shekels (US$460,000).
A Crypto Exchange by the “Bitcoin King of Israel”
The closure of Bitin was mandated by the Commissioner of Capital Markets, Insurance, and Savings, Amit Gal. While the Bitin website is still accessible, reports confirm that its crypto trading services are no longer operational.
Bitin was known for offering a wide range of cryptocurrency buying and selling options, including popular digital assets like Bitcoin, Ethereum, Litecoin, Ripple, USDT, and USDC. The platform boasted of providing the best rates in Israel for purchasing Bitcoin and other virtual currencies.
Curiously, the website’s disclaimer in the footer explicitly states that it does not offer financial services (translated from Hebrew).
In Israel, cryptocurrency exchanges are required to obtain a licence from the Israeli Capital Market, Insurance, and Savings Authority (CMISA) in compliance with the Financial Services Supervision Law that regulates crypto service providers.
Rejection Is Not the End
The Israeli regulator disclosed that Bitin’s licence application was denied in 2022 due to the operator’s involvement in a previous criminal investigation. Despite the rejection, the operator continued to facilitate crypto transactions, flouting local regulations.
The exchange operator had been apprehended in February 2020 on suspicions of tax offenses and money laundering, alongside three other individuals. While the “Bitcoin King of Israel” was acquitted of the money laundering charges a year later, he was slapped with a hefty fine of 15 million shekels for breaching reporting obligations.
Earlier this year, the Israeli Securities Authority (ISA) cautioned the public against a binary options trading platform called Pocket Option, targeting Israeli traders. The ISA had prohibited the promotion and distribution of binary options within the country in March 2016 due to rampant fraudulent activities, prompting such firms to shift their focus to overseas markets. The ban on Israeli companies marketing binary options internationally was reinforced in October 2017.