According to a Reuters report, Leumi, the largest banking institution in Israel, has enabled crypto trading. The first bank in this country to give its users access to this burgeoning asset class, customers can trade Bitcoin, Ethereum.
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To provide the service, Reuters said, the bank will use its digital platform Pepper Invest. The financial institution has partnered with Paxos, the US-based regulated blockchain company.
Currently, the bank’s client can only buy, sell and hold Bitcoin and Ethereum with transactions of at least $15.49. Reuters quoted the following source about the added benefits of using this service:
Pepper will collect taxes according to the guidelines of the Israeli tax authorities, so customers don’t have to manage complicated taxes.
The service is currently awaiting approval from the Israeli regulator. Therefore, the bank has yet to give an official launch date for the product.
According to the report, Leumi is launching the service to remove friction from the process of crypto trading. Including the need for users to download and maintain a digital wallet.
This suggests that users will not retain their Bitcoin and Ethereum private keys and may be relinquishing too much power to the financial institution. The bank can determine when and why a user can be banned from their funds.
So this new service seems less efficient than actually keeping Bitcoin and Ethereum on a user-controlled digital wallet.
As seen below, the bank’s Pepper app would allow users to invest in digital assets and shares of public companies. Like Robinhood, TradeFi US app offers similar features, users can buy Apple, Amazon and other stocks.
Pepper app. Source: Globe
Crypto to Enter Israel Mainstream
A separate report from Globes indicates that the Israeli bank has chosen Paxos because it is subject to a high level of supervision by US authorities. The company has several licenses to work with Bitcoin, altcoins and blockchain technology.
Since its founding in 2021, the company has managed to consolidate key partnerships with PayPal, Revolut and the Bank of America, according to Globes. Paxos has over $20 billion in assets under management.
Pepper CEO Uri Natan told Globes about their recent partnership with Leumi:
We are proud to be the first in the banking system in Israel, and one of the few in the world, to offer our customers the ability to trade cryptocurrencies in a simple, secure and reliable way, without having to download a wallet and without having to deal with the tax authorities. This is a game changer that has opened a window for our clients into the next world of investing and the future of banking.
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At the time of writing, Bitcoin is trading at $44,400 with a gain of 1.4% in the last 24 hours.
BTC’s price trends are moving upwards on the 4-hour chart. Source: BTCUSD Tradingview