On Friday, Bank Leumi, one of Israel’s largest banks, announced that its digital investment platform Pepper Invest has begun a collaboration with U.S. blockchain infrastructure provider Paxos to introduce cryptocurrency trading to Israeli customers. The deal makes Pepper the first banking platform in Israel, and one of a handful of banking institutions worldwide, to allow its customers to trade cryptocurrencies, in an attractive pricing model. The services will also become accessible to Bank Leumi customers in the near future.
Upon completion of the regulatory approvals, the service will allow Pepper Invest customers to buy, hold and sell cryptocurrencies, initially Bitcoin and Ethereum, starting from an amount of NIS 50 (about $15.60) per transaction, through their trading account at Pepper Invest. During the sale transaction and conversion back into NIS in the current account, Pepper will collect tax in accordance with Israeli Tax Authority guidelines so that customers will not need to manage tax complexities. Bank Leumi describes the simple sale model as a “significant innovation compared to the present difficulties” in converting cryptocurrencies into available funds in a current account, with the tools presently available.
Founded in 2012, U.S.-based Paxos specializes in building safe, regulated enterprise digital asset solutions for global companies, including PayPal, Interactive Brokers, Meta, Mastercard, MercadoLibre, Bank of America, Credit Suisse, Societe Generale and Revolut. To date, the company has raised $540 million in private market venture capital, with strategic investors including Oak HC/FT, Declaration Partners, Founders Fund, Mithril Capital and PayPal Ventures. Paxos currently manages around $20 billion in assets and serves more than 400 million end customers worldwide.
“We are proud to be the first in the Israeli banking system and one of the few worldwide to offer our customers to trade in cryptocurrencies simply, safely and reliably, without the need to download a crypto wallet and with all tax complexities being resolved by the bank,” Pepper CEO Uri Nathan said. “This step is a game-changer and offers our customers a bridge to the new era of investments and to the future of banking.”
Earlier this month, Paxos announced that it has received in-principle approval from the Monetary Authority of Singapore (MAS), a premier financial regulator in Asia-Pacific, to operate digital payments token services under the 2019 Payment Services Act. In a statement confirming the news, Paxos said the approval makes it one of the first blockchain services providers to meet the highest standard of regulation in both New York and Singapore.
