Short Description
Israel’s crypto industry launches a major lobbying push for regulatory reform, aiming to add $38B to the economy by 2035 and create 70,000 jobs.
Read Time
4 minutes, 10 seconds
Main Article
Israel’s digital assets sector is poised for a transformative leap as industry leaders unite to demand crucial regulatory reforms. The Israeli Crypto Blockchain & Web 3.0 Companies Forum is spearheading a significant lobbying initiative, citing research from KPMG that projects sweeping economic benefits. Their report suggests that modernizing regulations for stablecoins, tokenization, and tax compliance could inject 120 billion shekels ($38.36 billion) into the nation’s economy and create over 70,000 new jobs by 2035. Forum leader Nir Hirshman-Rub emphasized the urgency, stating that 2026 is seen as a “defining year” for the industry, especially following the recent Gaza ceasefire.
The push for reform is fueled by substantial grassroots adoption and a thriving startup ecosystem. KPMG’s research indicates that more than 25% of the Israeli public has engaged with cryptocurrency in the past five years, with over 20% currently holding digital assets. Israel’s crypto economy has shown steady growth, with annual inflows exceeding $713 billion. Homegrown giants like Fireblocks and Starkware are global leaders, and local blockchain and digital assets startups have attracted a significant portion of worldwide investment. However, businesses face a major hurdle: Israeli banks frequently refuse services or impose debilitating due diligence on companies dealing with digital assets, stifling growth and innovation.
The industry’s call to action aligns with broader governmental efforts but highlights areas needing immediate attention. While the government’s National Crypto Strategy Committee has outlined a strategic framework and the Tax Authority introduced a voluntary disclosure procedure for unreported crypto income, participation remains low. The Forum argues that alongside a unified regulator and clear issuance rules, removing punitive tax policies—such as a 50% rate on employee token options versus 25% for traditional stock—and forcing banking integration are essential to unlock Israel’s full potential as a Web 3.0 leader and compete on the global stage.
Short Summary
Israel’s crypto industry is lobbying for key reforms in stablecoins, tokenization, and taxation, which KPMG estimates could boost the economy by $38B. Despite strong public adoption and a vibrant startup scene, banking restrictions and complex tax policies remain significant barriers. The industry sees 2026 as a pivotal year to align regulations with growth and solidify Israel’s position in the global digital assets landscape.
