An Israeli Bitcoin mining firm has scored a victory of sorts, after a Tel Aviv court ruled that the Union Bank of Israel is not allowed to close their account based on their association with Bitcoin. The bank is however allowed to refuse any deposits that result from cryptocurrency activities, rendering the presence of the account almost worthless given the firm’s operations.
This case is another step along the twisting path of Israel’s relationship with cryptocurrency and somewhat undermines a ruling made last year by the same court that forced a bank to accept Bitcoin-derived proceeds from a Bitcoin trader.
Israminers’ Proof not Enough
The court case dates back to April 2018 when Union Bank abruptly ceased accepting deposits from mining firm Israminers, before returning all previous deposits and closing their account. It cited concerns that the association with Bitcoin could have involved money laundering activities. Israminers were forced to stop operations seeing as they couldn’t sell the Bitcoin for the national currency, NIS, and launched a legal appeal against Union Bank’s actions, claiming they were able to prove where the Bitcoin had come from. This doesn’t seem to have swayed the courts however, who yesterday upheld Israminers’ right to maintain their business account, but sided with the bank in terms of what can and can’t be deposited, seemingly regardless of evidence proving the source of the funds.
Prior Verdict Didn’t Set Precedent
The verdict is at odds with a separate case that was settled just a few weeks after Israminers launched their legal case in May 2018. In that case, a Bitcoin trader again had his deposit rejected by a bank, this time Bank Hapoalim, who also cited concerns over illegal activities connected to cryptocurrencies. The trader also took the bank to court and won the case after he was able to prove the origins of the funds. This seemingly did not set a precedent however, as Israminers now find themselves at the wrong end of a similar case.
What do you think? Is the court right to stop deposits from crypto-based endeavors, or have the Bitcoin miners been hard done by? Let us know your thoughts below!