- There is rising demand to transfer funds from crypto into fiat accounts
- NBM must contact a legitimate crypto trading service and crypto custody provider
Tel-Aviv Stock Exchange (TASE) published a draft to approve expanding the authorized activities of Non-Banking Members (NBMs) to include cryptocurrency trading, Bankless Times learned from a press release.
Market turmoil signals a need for regulation
The cryptocurrency market has undergone significant volatility over the past year, which has brought tangible changes in activity involving digital assets. More and more institutions want to intervene in the workings of the sector. Market turmoil signaled the need for regulation in the field in view of the lightning-speed development of the crypto sector over the last few years.
Growing demand to transfer funds to fiat accounts
More and more traders and investors are getting involved in the sector as well. This trend goes hand in hand with rising demand to transfer funds from crypto into other accounts. This requires rules and guidelines to mitigate legal, operative, cyber, and other risks typically associated with cryptocurrency activities.
Customer protection is at the heart of the proposal
According to TASE’s proposal, the NBM will contact a legitimate cryptocurrency trading service provider and a licensed crypto custody provider. In order to buy the cryptocurrency, the customer deposits fiat in his account with the NBM. It can be in national or foreign currency.
The sum remains in an omnibus account of the NBM with the trading services provider, not unlike the process of depositing foreign securities.
Transactions are recorded in the customer’s NBM account
When the customer sends an order to buy cryptocurrency, the transaction will be executed using the funds in the omnibus account. It will be recorded in the customer’s NBM account.
The trading services provider sells the crypto when he gets the respective order from the customer. He then credits the NBM’s omnibus account with the corresponding amount in fiat.
