Israeli Official

Israeli Official Urges Regulators to be More ‘Paternalistic’ Regarding ICO’s and Bitcoin

An Israeli official gave a talk in Tel Aviv today regarding the challenges with regulating ICO’s and bitcoin. Professor Shmuel Hauser, Head of the Israeli Securities Authority, expressed fear and concern about cryptocurrencies. He seemed to see digital tokens as representing a threat, and he urged regulators to be more “paternalistic” in their oversight of ICO’s. 

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Investors Cannot Look After Themselves and do Not Understand Cryptocurrencies

Hauser elaborated on his position, saying, “We have to address today what is happening with bitcoin, blockchain and ICOs that are challenging the current regulation around the world. It is here at the gates of the stock exchange. It is a new economy where the companies have no faces, and the investors have no faces. Our task is to get ready now in a proactive fashion before an event will occur that will hurt Israeli investors.”

In this sense, it appears Hauser is attempting to alert regulators of the world to prepare for more digital currencies and ICO’s to spread. Hauser suggested many people invest in digital currencies and they do not understand them. He implied they need government protection, because 67% of people cannot look after themselves. Overall, 60% of the public have been exposed to digital investment opportunities.

Israeli Official Urges Regulators to be More 'Paternalistic' Regarding ICO's and Bitcoin
Shmuel Hauser, Chairman of the ISA – FM

Does the World Need Regulators?

Hauser mentioned bitcoin is not a passing fad. It is here to stay. Regulators have to be prepared. He said the SEC recently rejected a bitcoin ETF. He said this because regulators do not yet comprehend cryptocurrency. They do not know how to go about creating a regulatory framework. He also mentioned there are already IPO’s without a prospectus.

Gentlemen, this is not a passing phenomenon. It is here at the gates of the capital market. It is here at the gates of the stock exchange. Is it a widespread phenomenon, is it a phenomenon that requires the protection of the state? Regulators? In this new economy, there are no faces for investors and there are no faces for companies. 

He finished his thought by asking one important question: does the world even need regulators anymore?

How Should Regulators Handle ICO’s?

Hauser answered his own question by bringing up the topic of ICO’s and how they Israeli Official Urges Regulators to be More 'Paternalistic' Regarding ICO's and Bitcoinshould be regulated. Currently, he said ICO’s are funds that are generated via the creation of blockchain, bitcoin, and similar cryptocurrencies, and they ignore the current supervisory system. In other words, there is no oversight or protection for investors or speculators.

Hauser then detailed all the different ICO’s and the kind of revenue they have generated, saying, “Israeli Bancor, which raised $153 million in three hours for a conversion protocol; Gnosis, which raised $12.5 million in ten minutes for building a platform for predicting events; Brave, which raised $35 million in 24 seconds for developing a browser; Aragon, which raised $25 million in 15 minutes for decentralizing companies; and more.” 

He asked what these new tokens should be considered for regulatory purposes. He started thinking out loud. They are not like business IPO’s. Investors do not actually gain ownership in the company. Nor did the startup undergo any kind of organizational process or submit a prospectus to a regulatory agency. The ICO simply generates new tokens and people invest in it because it could harbor value in the future. Hauser admitted these new digital assets are not like a stocks or bonds. They are a different animal entirely. In his final analysis, Hauser said cryptocurrencies in an ICO are closer to an IPO in some regards, and he believes that is a starting point to begin thinking about outlining some regulations.

Do you believe regulators will have more challenges regulating Bitcoin and ICO’s in the future? Let us know in the comments below.


Images via Shutterstock and financemagnates.com


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  • Liberty88

    Yes, we can’t have an individual investors taking responsibility for their own Investments. Us Bankers need to tell them what to invest in and what to steer clear of…. Mainly we want them to invest in are scams that keep them enslaved to our products while we print our asses off. All while we live high in our mansions overlooking the serfs (aka you little people.)

  • miamisands

    let the games begin

  • I can understand the fraudulent behavior of bitcoin with those who want to defraud, scam, illegal behaviors. I get all that but am not thrilled that the government or any central bank would be involved in regulations. They can’t even take care of fiat money…that’s the reason why cryptocurrencies have taken off…decentralization.

  • Carlos

    Digital currency is here to stay and we are at the beginning (still) of this evolving phenomenon which will lead to a global currency of the future. Moving from the fiat currencies controlled and managed by governments to a currency that represents real value, opportunity, and freedom (decentralization).
    My question would be what are the governments and regulators seeing that is a real risk and what is that risk? Are we looking at a collapse in our economy or just looking at individual investors who may not be making smart investments? I believe the latter happens today outside of digital currencies.
    These are exciting times and I love watching how this all unfolds and how does it impact and/change our underlying financial infrastructure. Regulators and agencies have to think outside the box and up their game as all this evolves.

  • nasir man manuty

    Jews always Jews mentallity ” Dictatorship ” Ideoligy.They always right.

    • Daxx10

      Every fool needs a Shmuel.

  • Gary Sachs

    Suggest that he spreads light instead of darkness and see if this helps!!

  • Recognized and Individualistic. Maybe Bankers should go back to the way they used to operate, paying you better than capital controlled rate to be in their bank. Keep thinking out loud and you may find where you left the others out ahead of you. Who am I kidding, they will never go back to rational thought. It would be shattering if they did.

  • scott manhart

    As if people understand their 401K plans an other investments! This is just another claim by the legacy financial system to try to keep all the toys in their private sandbox.

  • Nandi Langa

    Uggghhh… typical ZOG authority… the average Israeli is very smart and well able to comprehend new technologies, in fact, Israel is probably the most tech-savvy nation… Even Israeli Government is stupid, DAO will replace this Kakistocracy…. blockchain will leave 95% of government officials with a begging cup.

  • Ganancia Diaria Para Ti

    Cada vez el tema se amplia, la discusion tambien, y los resultados? ya veremos, espectativa señores, espectativa, como el Iceberg de mas de 5000 km, que se desploma, algunos se desploman mientras otros se empoderan aun mas, espectativa señores, espectativa.