Knesset passed a law on October this year to outlaw binary options following many fraudulent activities in the 10 years of the industry in the country and many people who were left jobless could look for opportunities in the cryptocurrencies industry.
Binary options were a huge deal in the country with Ramat Gan alone attracting 10,000 binary options. Thus workers prior to closure of the companies. The parliament voted against the trade and the law comes to effect in January. But the companies were given three months to stop trade.
Many of those who were in the binary options industry were already exploiting opportunities in diamond sales, predatory business loans and Forex, but cryptocurrencies and Initial Coin Offerings could be the next “big thing” for them if all goes well.
However, Traffic Lords — an online marketing dealer, co-working space and affiliate network — in October held an event related to crypto, which was attended by many ex-binary options dealers. It targeted affiliate marketers looking to earn from the emerging cryptocurrency and ICO dealings. It was a huge deal given that Israel is considered a global powerhouse of affiliate marketing. Although much of the efforts are targeted on Forex platforms such as Tel Aviv-founded eToro. The binary options and online gambling sites.
Most of those in attendance were aged between 20s and 30s.
“We here at Traffic Lords, we are an affiliate network,” said a representative of the company that night of the event. “The offers we have in our system pay in dollars, not cryptocurrency. We pay for ICOs; we pay for people who can bring traffic to exchanges where you can buy and sell bitcoin.”
But that “was a small change” according to an audience shouting from the crowd in the meeting, who would rather spend his time diverting traffic to Tel Aviv-founded eToro. To which the Traffic Lords representative replied saying there was “no problem” and that they had offers paying more than eToro.
“Look, ICOs are a bit of a different bird,” he went on. “They haven’t totally figured out the payment structure yet. But there are cryptocurrency trading platforms that are identical to all the online trading industry. We’ve been doing this a long time and just recently we did a big pivot into the world of cryptocurrency or blockchain. I am telling you there is opportunity here. We identified it a few months ago.”
In attendance was Israel’s bitcoin community reps, like Meni Rosenfeld and Yuval Rouach, hard-core cryptocurrency and decentralization activists. There were business people from various industries hoping to hear about cryptocurrency opportunities.
Four of the six speakers of the event were from Alignment. A new partnership between Israeli venture capitalist Moshe Hogeg’s Singulariteam Technology Group BlockchainIL. And cryptocurrencies investment group CoinTree Capital. The four were Sefi Golan, the CEO and chairman of Blockchain IL; Hogeg; a man named Ofir from Cointree Capital, and a representative from Traffic Lords.
Cointree Capital’s Ofir told the attendants that they help companies launch ICOs in the country, and their first project was Kik messaging app that raised $100 million and a second project called Stox that raised $40 million.
“It’s a question of how much risk you’re willing to take and how much you’re willing to earn,” he told the audience in response to a question. “Ever since Ethereum was invented, when people saw that its ICO raised a lot of money, lots of people around the world who don’t know what they’re doing will just put $1,000 or $2,000 or $3,000 into an ICO. People are raising huge amounts of money in what is essentially a casino.”
Moshe Hogeg, a managing partner of the venture capital firm Singulariteam, encouraged affiliate marketers to find ways to make cryptocurrency investing attractive to ordinary people.
“Cryptocurrency is great for micro-payments and for people who sell drugs,” he explained, attracting laughter from the audience. “They have no need for money mules. In fact it’s a great use for the world of crime, but that’s not why we’re here.”
Some of those in the legitimate cryptocurrency industry in the country fear that binary options and the rush in illegal dealings in crypto. It may ruin the reputation of the industry. Some of those who have entered the field aim at making huge kills from unsuspecting investors according to Times of Israel.
Speaking at the event, Sefi Golan of BlockchainIL told audience at the Traffic Lords event. Thus they need to know that countries treat cryptocurrencies as an opportunity. And that it was real business and they were willing to protect investors.
“We have a direct channel to regulators, and you need to understand that countries see this technology as an opportunity to develop their economies. In the last three months we have filled four-and-a-half floors of this building with new companies. This is a real business; I think the authorities understand that this is a real business”.
Hogeg met the Finance Minister Moshe Kahlon to discuss cryptocurrencies and ICOs on October this year.
“I am very happy to report that I just finished a terrific meeting with Finance Minister Moshe Kahlon on the topic of blockchain and cryptocurrencies. The minister is very positive and supportive. This is heartening and moves us towards a solution and together with the government. It supports innovation, we will be able to create a lot of value for everyone”.
The Israel Securities Authority’s outgoing chairman, Shmuel Hauser, who drafted the binary options law has signalled that cryptocurrencies could be the next binary options in the country or in other words, just another big scam.
Calcalist Fintech conference on November 8 said,
“We want to make sure that the world of cryptocurrencies does not turn into a mutation of the binary industry. Since that it does not become a haven for scammers”.
Israel Securities Authority is also worried about cryptocurrencies. Although it treats blockchain as a legitimate technology that is “going to cut costs and conquer the world”. According to its chairman Shmuel Hauser at a Finance Committee meeting in the Knesset in September.
“We’re very concerned about cryptocurrencies because the phenomenon exhibits many signs of a bubble. Someone will tell you to buy this or that token because its value is going up. But you don’t know who is behind the token. And you don’t know who is behind the demand, who is behind the supply. And if something goes wrong, there is no one to turn to”.
BlockchainIL said he was confident the regulators would take the right steps to support the industry while protecting investors from fraud.