Bitcoin Makes Aliyah as Virtual Currency Gains Favor in Israel

ATMs Spit Out Scanable Cash in Tel Aviv

Virtual Cash Machine: Customer obtains bitcoins from an ATM in Tel Aviv.
getty images
Virtual Cash Machine: Customer obtains bitcoins from an ATM in Tel Aviv.

By Ben Sales

Published June 12, 2014.
  • Print
  • Share Share
  • Single Page

(JTA) — Blocks away from the Tel Aviv Stock Exchange and the headquarters of two major banks, in the corner of the lobby of a boutique hotel, Nimrod Gruber sticks his hand into an ATM.

A few seconds later, a QR code prints out. Gruber takes the slip of paper and walks away, no cash in hand.

He’s not worried. He owns the ATM, and there’s nothing like it in the Middle East. It identifies users by scanning their palms, and instead of dispensing dollars, euros or shekels, it dispenses Bitcoin.

“It shows up in your account in 30 seconds, a minute,” he said.

Bitcoin, a digital currency invented in 2008, has spread across the world, and made a hefty profit for its holders, without printing a single bill. As Bitcoin has gained value over the years, an ecosystem of startups and organizations has taken shape in Tel Aviv to promote its use in Israel’s tech scene.

“Here we adopt new technology earlier than other places,” said Gruber, 28, a former model who became involved in Bitcoin technology during a stint living in New York City. “It makes sense that this would be a Bitcoin center. We’re at the heart of the high-tech area and the Tel Aviv financial district.”

Called a “cryptocurrency” because it is secured by encrypted data, Bitcoin itself could be best described as cryptic. Its reputed inventor, who goes by the name Satoshi Nakamoto, has communicated only by email. Unlike mainstream currencies, Bitcoin isn’t backed by a government or central bank and has no physical form.

Instead, it exists in computer code, and its value is determined purely through supply and demand in online exchanges where Bitcoin holders buy and sell it for other currencies. People can “mine” new Bitcoins by performing complex calculations on their computers.

Bitcoin has encountered a host of issues in its development, from the question of government regulation to use for illegal activities to a volatile growth pattern. According to a digital currency tracker, one Bitcoin was worth about $100 a year ago and had spiked to nearly $1,000 by last November. Three weeks later, though, its value dropped to about $600 after China banned its use. It’s worth roughly $630 now, with $8 billion of total Bitcoins on the market.

The ups and downs haven’t deterred Israeli Bitcoin believers, who expect growth ahead and say the currency will stabilize as more people adopt it. Dozens of startups have proliferated around Bitcoin use in Israel, and more than 120 Israeli businesses, from restaurants to real estate firms, accept Bitcoin as payment.

“I hope we can make Israel a lab for Bitcoin,” said Ayal Yona Segev, an “ambassador” at Bitcoin Embassy, which provides guidance and acts as a meeting spot for Israeli Bitcoin entrepreneurs a few blocks from Gruber’s ATM. “We have the flexibility to become a place where we test and develop everything.”


The Jewish Daily Forward welcomes reader comments in order to promote thoughtful discussion on issues of importance to the Jewish community. In the interest of maintaining a civil forum, The Jewish Daily Forwardrequires that all commenters be appropriately respectful toward our writers, other commenters and the subjects of the articles. Vigorous debate and reasoned critique are welcome; name-calling and personal invective are not. While we generally do not seek to edit or actively moderate comments, our spam filter prevents most links and certain key words from being posted and The Jewish Daily Forward reserves the right to remove comments for any reason.





Find us on Facebook!
  • Former Israeli National Security Advisor Yaakov Amidror: “A cease-fire will mean that anytime Hamas wants to fight it can. Occupation of Gaza will bring longer-term quiet, but the price will be very high.” What do you think?
  • Should couples sign a pre-pregnancy contract, outlining how caring for the infant will be equally divided between the two parties involved? Just think of it as a ketubah for expectant parents:
  • Many #Israelis can't make it to bomb shelters in time. One of them is Amos Oz.
  • According to Israeli professor Mordechai Kedar, “the only thing that can deter terrorists, like those who kidnapped the children and killed them, is the knowledge that their sister or their mother will be raped."
  • Why does ultra-Orthodox group Agudath Israel of America receive its largest donation from the majority owners of Walmart? Find out here: http://jd.fo/q4XfI
  • Woody Allen on the situation in #Gaza: It's “a terrible, tragic thing. Innocent lives are lost left and right, and it’s a horrible situation that eventually has to right itself.”
  • "Mark your calendars: It was on Sunday, July 20, that the momentum turned against Israel." J.J. Goldberg's latest analysis on Israel's ground operation in Gaza:
  • What do you think?
  • "To everyone who is reading this article and saying, “Yes, but… Hamas,” I would ask you to just stop with the “buts.” Take a single moment and allow yourself to feel this tremendous loss. Lay down your arms and grieve for the children of Gaza."
  • Professor Dan Markel, 41 years old, was found shot and killed in his Tallahassee home on Friday. Jay Michaelson can't explain the death, just grieve for it.
  • Employees complained that the food they received to end the daily fast during the holy month of Ramadan was not enough (no non-kosher food is allowed in the plant). The next day, they were dismissed.
  • Why are peace activists getting beat up in Tel Aviv? http://jd.fo/s4YsG
  • Backstreet's...not back.
  • Before there was 'Homeland,' there was 'Prisoners of War.' And before there was Claire Danes, there was Adi Ezroni. Share this with 'Homeland' fans!
  • BREAKING: Was an Israeli soldier just kidnapped in Gaza? Hamas' military wing says yes.
  • from-cache

Would you like to receive updates about new stories?




















We will not share your e-mail address or other personal information.

Already subscribed? Manage your subscription.