Israel Set to Become Major Blockchain Innovation Hub

Israel is a hub for technological development and innovation due to its friendliness toward startups. In an interview with Coin Journal, Yaniv Altshuler, CEO of software company Endor, discussed the country’s attitude toward tech starts:

Israel boasts a warm, receptive, and supportive environment for startups. The result of the vibrant and healthy ecosystem is that an extraordinary amount of successful tech companies has been founded in Israel, such as ICQ, Wix, and Waze. The culture fosters innovative thinking where people are always being pushed to invent the next way of making life easier, faster, and more efficient.

The data seems to support Altshuler’s position. This year, Bloomberg ranked the country second on its list of the top global innovators in fields of research and development. The United States did not appear on the list this year, after having been on the list for the past six years.

The country’s innovation and growth has led many professionals with experience in cryptographic, fintech, and cybersecurity to stay there. At the beginning of 2018, the country had 88 blockchain and cryptocurrency startups, with most of them being fintech companies, with both enterprise and cloud computing, social media, and infrastructure and protocol development coming close behind.

The Israeli Securities Authority (ISA) recently released an interim report concerning the regulation of public ICOs. The regulation has progressed in terms of blockchain and cryptocurrency innovation. According to Daniel Peled, president of startup Orbs:

“It is . . . very clear from that report, and our own discussions with ISA committee members, that there are not out to kill the market, but are looking to strike the right balance between allowing crypto business to flourish within Israel and protecting token/cryptocurrency holders’ rights.”

The report continued that the country is interested in achieving a balance between protecting investors and promoting innovation. The ISA also created a special committee for the project. The report concluded that it will treat cryptocurrency as a security on a case by case basis, excluding products like exchanges and payment platforms.

Last year, Microsoft partnered with Israel’s Bank Hapoalim to create software for digital bank guarantees based on blockchain technology, which makes it the first banking institutions in the country to use the technology for financial contracts. Further, startups and nonprofits in the country are focusing on education to stress the importance of the blockchain and they are also working to improve adoption of the technology.