In Israel, the number of blockchain and crypto-related companies increased by 32% in 2019, according to a report from the Israeli Bitcoin Association published on Dec. 30.

The report revealed that there were 150 active companies in the field in 2019, while at the end of 2018, the number was 113. Out of the 113 companies, only 63 continue to operate today, with the information about the rest of them unavailable. The Association suggested this is because those companies did not survive the past year.

Other related statistics

Although the report did not provide data on the number of employees serving for the reported companies, it said that the staff size decreased significantly in 2019 as compared with 2018 and 2017. The data indicated that most of the companies had no more than ten employees.

The report further revealed that the majority of the companies were startups, operating within three years, wherein 30% of currently active companies were established in 2017 and 30% in 2018.

In terms of financing sources, 44% of crypto- and blockchain-related firms operating in Israel were self-funded in 2019, while 42% raised funds from investors. At the same time, 7% of the companies reportedly rely on independent income to finance operations.

A blockchain-friendly hub

Israel is known as a blockchain-friendly hub, ranking 49th out of 190 on the ease of doing business index, according to the Doing Business 2019 report compiled by the World Bank. However, its overall score belies certain areas of difficulty for businesses like paying taxes, with Israel’s rank being 90th out of 190. Another trouble spot is enforcing contracts, for which Israel again ranks 90th.

Last August, news broke that the Capital Market, Insurance and Saving Authority, a division of Israel’s Ministry of Finance (MoF), was looking to accelerate the process of procuring licenses for blockchain and fintech companies in the country. The authority was hoping to foster local competition by licensing more fintech companies.