Israeli Mining Company Sues Union Bank of Israel for Refusing to Operate an Account to a Mining Firm
The sixth largest Israeli bank, Union Bank of Israel, Ltd. (TLV: UNON), has been accused by a lawsuit by a local cryptocurrency mining company. Israminers Ltd blames the bank of individually deciding, after three months of operations, that it will no more enable the company to accept funds from bitcoin exchanges, and then transferring back money already received in the account – preventing the company from buying additional mining hardware and shutting down the account within 30 days.
The originators of Israminers, one of which is also the owner of a law firm, have chosen to take the case to the courts, requesting for a respite from the bank’s decision. The company has moreover turned to the Israeli banking regulator with a formal complaint against Union Bank. And today, the miners have declared that the Herzliya court has accepted the case, granting an interim order against the bank.
Adv. Guy Penn revealed that:
“Banks in Israel currently deny services to companies that operate in the crypto field, without even checking or understanding their business activity. The banks’ overwhelming refusal leaves us with no choice but to take our case to the courts of law. Otherwise, the entire Israeli crypto field will have to relocate its business model abroad.”
The Israeli banking system has not been willingly open to bitcoin-related business, which forces companies to turn to the courts to get service. In February, Bitflash LTD, a company which was instituted to render Cryptocurrency trading services based in Acre, has asked the Tel Aviv District Court for ordering all 11 banks in the country for opening a current account without credit for it.
After that month, the Supreme Court of Israel announced a provisional injunction order prohibiting Bank Leumi from sweepingly freezing the account activity of the Bits of Gold bitcoin exchange. It was seen as a significant victory in the Israeli cryptocurrency industry – and one that sets an example for other bitcoin businesses struggling to get banking services.