The Israeli government has formed a special task force dedicated to the regulation of Decentralized Autonomous Organizations (DAOs).
In an official statement, it was disclosed that the team, chaired by the Chief Economist of the Ministry of Finance and the Head of the Corporations and Capital Market Cluster at the Ministry of Justice, will investigate the functionalities and activities conducted by DAOs.
The primary mission of the team is to scrutinize the usage of cryptocurrency tokens within DAOs and to gauge the associated risks.
Their intention is to create a regulatory framework that maintains a balance between encouraging innovation and protecting the interests of stakeholders.
“The team is looking into necessary regulations, which encompass corporate status, tax considerations, and other aspects of DAOs, with the intention to foster legal certainty, mitigate risk factors associated with DAO activities, and leverage potential benefits for the Israeli economy,” according to the official announcement.
In addition to this, the Israeli government plans to solicit public feedback on DAO regulations, with the consultation period set to run until September.
DAOs are organizations that use blockchain technology and native cryptocurrency tokens to empower stakeholders in participating in decision-making processes.
This latest action by the Israeli government is part of a more comprehensive initiative aimed at instituting stringent regulations for the cryptocurrency industry.
Recently, legislators in the country have expressed support for eliminating capital gains taxes for foreign investors in crypto, an effort designed to draw international investments.
Earlier this month, a bill offering an exemption from capital gains taxes on digital currency sales for foreign residents in Israel, along with other tax benefits, successfully made its way through a preliminary reading in parliament.
“Much like Rishi Sunak in the United Kingdom and legislators across Europe, Finance Minister Bezalel Smotrich has energized the local sector and issued an unequivocal invitation to global investors and businesses – Israel welcomes your commercial engagements on our soil,” said an explanatory note accompanying the bill.
Isreal Confiscates Crypto Believed to Blong to Militant Groups
In the previous month, Israel disclosed that it had confiscated millions of dollars in cryptocurrency purportedly used to fund Iran-backed militant organizations.
Before that, the Israeli government seized a substantial amount of cryptocurrency tied to the militant wing of Hamas, the governing authority in Gaza.
In December of the previous year, a court in Tel Aviv gave a ruling allowing the Israeli government to confiscate all cryptocurrency in more than 150 digital wallets that had been blacklisted for allegedly financing terrorist organizations.
At that time, Israeli Defense Minister Benny Gantz stated that the authorities had seized $33,500 from digital wallets associated with the militant group, Hamas.
