Israel’s Supreme Court has issued a temporary injunction preventing Bank Leumi from broadly blocking the account activity of local bitcoin exchange Bits of Gold. Until the appeal is fully decided, the company will be allowed to continue conducting digital currency-related activity through its bank account. The ruling is widely seen as a significant development for Israel’s crypto sector and could influence how banks deal with similar businesses going forward.
A long-running dispute over banking access
According to the report, Bits of Gold has held an account with Bank Leumi since its founding in 2014. The company is licensed as a currency changer business, but in 2015 the bank decided to close its account. The issue was not a proven violation by the company, but rather the fact that its business involved bitcoin. Bits of Gold then turned to the courts in order to keep using the account.
For years, the company operated under an injunction while the legal battle continued. A few months ago, a district court authorized the bank to prevent Bits of Gold from trading in bitcoin, even while recognizing that the company had conducted itself transparently. Bits of Gold appealed that decision to the Supreme Court, which quickly issued temporary relief and later clarified that the firm could continue digital coin trading in the account until the full appeal is resolved.
The court questioned the bank’s assumptions
In its reasoning, the Supreme Court said the damages cited by the bank appear, at this stage, to be speculative. The bank’s position was based on the assumption that the company’s activity created legal and regulatory risks that could eventually expose the bank to consequences. But the court noted that, over more than five years of the account’s operation, those fears had not materialized. It also referenced the lower court’s finding that the company acted transparently and did not breach any statutory provision.
That language is important because it pushes back against blanket restrictions on crypto businesses where no concrete wrongdoing has been established. Shaul Zioni, the lawyer representing Bits of Gold, described the decision as a precedent-setting one for digital currency trading. In his view, the message from the court is that banks cannot impose sweeping bans and should instead manage the risks involved.
Leumi still points to regulatory uncertainty
Bits of Gold CEO Yuval Roash said the decision allows the company to focus on expanding Israel’s crypto community and continuing its efforts to secure a larger role for digital assets in the country’s economy. He argued that digital coins can serve as a major growth engine for both the high-tech sector and the financial industry.
Bank Leumi, however, made clear it is not backing down completely. The bank said it respects the court’s decision, but maintains that in the absence of orderly and binding regulatory guidance, its exposure to bitcoin-related client activity remains a concern. Leumi added that the issue extends beyond Israeli regulators to foreign regulators who may not consider themselves bound by Israeli court decisions. For that reason, the bank said it would continue managing the case until the temporary injunction is lifted or clearer rules are established.
For the broader market, the dispute goes beyond one exchange’s access to one account. The case raises a bigger question: if a crypto company is licensed, transparent, and not found to have violated the law, can a bank deny service solely because of the sector it operates in? The final outcome of the appeal may become an important reference point for crypto businesses facing banking barriers in Israel and beyond.