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Israel Discount Bank to Let Customers Trade Bitcoin in App Starting Nov. 26

Bitcoin Magazine

Israel Discount Bank to Let Customers Trade Bitcoin in App Starting Nov. 26

Israel Discount Bank 前記 Wednesday that from Nov. 26 it will let eligible customers buy, hold and sell bitcoin and ether in the bank’s mobile app, a launch that would beat larger rival Bank Leumi if it stays on schedule.

The Tel Aviv-listed lender described the service as a first for Israel’s banking system in a Nov. 11 statement. Customers will be able to trade the two assets alongside stocks and bonds, without opening an account at an outside exchange or managing a separate digital wallet.

The offer is limited to private, not corporate, customers who are Israeli residents, 18 or older, and whose accounts are already set up for securities trading, subject to the bank’s terms.

“For the first time in the banking system, Discount Bank will allow trading in digital currencies directly from the bank account in a simple and secure manner, without the need for complex dedicated digital wallets,” Avi Levi, CEO of Discount Group, said in the statement. “This is a first step toward establishing advanced technological infrastructure in the digital currency space and developing the bank’s capabilities in this area.”

The rollout was led by Elad Fisher, head of the bank’s financial markets division. Coins will sit in bank-provided wallets built on infrastructure from Fireblocks.

A 2% commission and a wallet that does not leave the bank

The bank’s product page lists a 2% commission on purchases and sales in the app, not including any foreign-exchange conversion. Custody fees are waived for six months from the Nov. 26 launch and then run 0.25% a quarter. Trading is open Sunday through Friday from 9 a.m. to 11 p.m. Israel time, and only immediate orders are allowed. Customers can buy as little as 0.01 of a coin. Holdings appear in the securities portfolio at once, with cash settling the next business day in U.S. dollars; conversion into shekels happens only if the customer asks.

The service is a closed system for now. Bitcoin and ether bought through Discount cannot be sent to an outside wallet, and coins held elsewhere cannot be transferred in. The bank said it may revisit transfers later. It also warns of unusual risk, high volatility and the possibility of a total loss, and says the coins are not legal tender and lack the same protections as securities.

What Discount is selling, besides convenience, is tax treatment. Capital gains and losses on the coins can be offset automatically against the rest of the customer’s investment portfolio for tax withheld at source, the bank said, at a 25% rate on profits. Sale proceeds land directly in the customer’s bank account, without the source-of-funds questionnaires that have often accompanied money coming back from crypto platforms.

Leumi announced first, but is aiming for 2027

Discount is not the first Israeli bank to promise bitcoin trading. Bank Leumi, the country’s largest lender, announced a plan as early as March 2022 to offer bitcoin and ether through Pepper Invest with Paxos, a project that did not reach a full-scale launch. In August, Leumi and Galaxy Digital (GLXY) 前記 Leumi and Pepper customers would be able to buy, hold and sell bitcoin, ether and Solana in the Leumi Trade app, with a launch expected in early 2027.

That announcement billed Leumi as the first bank in Israel to offer the service. If Discount opens on Nov. 26, it would get there first, though Leumi still plans to offer Solana, which Discount is not including at the start. Discount said it may later consider adding other assets.

In an Oct. 7 circular, the Bank of Israel’s Banking Supervision Department amended Directive 411 to say that a bank may not refuse payment services solely because the funds come from virtual-currency activity, a change that takes effect May 1, 2027. The amendment does not authorize banks to offer crypto trading, but it is part of a broader effort, first floated in a July draft, to widen how banks handle crypto-related payments.

The test now is whether Discount hits the Nov. 26 date, and whether customers accept a closed wallet and a 2% commission in exchange for bank custody and automatic tax withholding. Leumi still has early 2027 to catch up.

This post Israel Discount Bank to Let Customers Trade Bitcoin in App Starting Nov. 26 first appeared on Bitcoin Magazine and is written by Micah Zimmerman.


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