Israel Records 30% Growth In Blockchain Focused Firms in 2019

Last year, the number of crypto and blockchain focused firms rose by 32% y-o-y in Israel, as per a report published on December 30 by the country’s Bitcoin Association.

The document disclosed that there were 150 active firms in the blockchain sector at the end of last year, up from 113 in 2018.

Notably, only 63 of the 113 firms currently operate today, with no further details available about the rest of them.

According to the Association the rest of the companies did not make it through last year.

Even though the report did not provide information on the number of employees working in the existing blockchain related companies, it is said that the staff size has declined considerably in 2019, compared with the previous two years.

The data further revealed that most of the companies had a maximum of ten employees.

The study also revealed that a large majority of these firms were startups operating for three years at the maximum. Furthermore, 30% of the active firms were established in 2017 and 30% in 2018.

Regarding funding, the report states that 44% of blockchain and crypto associated companies operating in Israel were self-financed in 2019, while 42% of the firms were backed by investors. At the same moment, 7% of the firms supposedly depended on separate income to fund operations.

Israel, considered as a blockchain friendly country, is ranked 49th out of 190 in the index reflecting the ease of doing business, as per the World Bank report titled “Doing Business 2019.”

Nevertheless, its total score hides some drawbacks faced by enterprises operating in the country. This includes tax payment issues, with Israel placed at 90th position among the 190 countries surveyed.

Even contract enforcement is a cumbersome task in Israel which is ranked 90th in the list.

In August 2019, news reports indicated that Capital Market, Insurance and Saving Authority, an organization under Israel’s Ministry of Finance (MoF), was attempting to quicken the procedure of acquiring licenses for fintech and blockchain firms in the country.

The authority hopes to encourage competition among local firms by providing license to numerous fintech firms.