Local Banks Held Ransom By Israeli Bitcoin Holders Demanding Cryptocurrency Accounts Policy

Bitcoin holders in Israel have taken legal action against local banks for their refusal to open accounts for customers seeking to deposit money from cryptocurrency sales, according to a report by Globes.

The holders are now demanding that the Bank of Israel, Israel's central bank, and commercial banks make their policies regarding cryptocurrency public.

According to the Globes' sources, the Israel Bitcoin Association has also filed a freedom of information petition in Jerusalem District Court to require local banks to disclose "policy documents from each of the banks in Israel concerning money from digital currency."

According to Jonathan Klinger, legal adviser to the Israel Bitcoin Association, "Under the Banking (Licensing) Law, it is the duty of a bank to state to the Bank of Israel the policy under which it refuses to conduct transactions. We therefore contacted the Bank of Israel and asked for this information, but the Bank of Israel did not agree to disclose this policy to us. We therefore decided to petition the court to force the Bank of Israel to provide us with a copy of the policy submitted to it by the banks."

In addition to preventing individual users from opening bank accounts, local Israeli banks have also refused to provide services to firms like the Israel Bitcoin Association, despite the association's status as a non-profit organization.