Following yesterday’s statement from the Bank of Israel on virtual currencies, DC Magnates has gathered reaction from some of the key figures in Israel’s Bitcoin community.

The Israel Bitcoin Association agrees with the key points within the statement, although they believe that many of Bitcoin’s shortcomings can be overcome with time and effort.

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They also stressed that Bitcoin’s risks should not be viewed in a vacuum, but rather in comparison with its many advantages.

Meni Rosenfeld, Chairman of the Israeli Bitcoin Association, said that the “The BoI statement didn’t really say anything new or controversial – there are indeed risks which should be carefully considered. But that should not, and BoI didn’t say it should, stop anyone from enjoying this amazing technology.”

Netanel Goldberg, CEO of GetReal Platforms and who is looking to launch a high performance mining chip, had this to say:

I think that all that is written in this document is true. Bitcoins are volatile, they are used by the black market, they are not centrally regulated and can be stolen from your PC. This is exactly what I would teach my son.

I would also tell him that people with no vision, who are highly dependent on the ability to control the market and print new money in order to control their citizens will be terrified by this new crypto coin invention and it is highly unlikely that they will support it.

The thing is very similar to what happened in the early days of pirate distribution of music over the internet: only after it was widely spread by the community it was adopted back by the central authorities, and nowadays we can all purchase legal music for $1.99 in iTunes.

The Bitcoin revolution will be driven by the mass market and the world users. It will take much time till the states realize the potential of crypto currencies and finally they will be delighted to use it to replace their own printed cash money. In a few years they will eventually understand the obvious: Crypto-coins are much more traceable than cash (!) Each and every transaction made can be traced to its origin, and the current fear of law enforcement from Bitcoins will be replaced with new regulations for crypto-currency identifications.

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Bitcoins are finally breaking the SWIFT system monopoly for WW currency transactions. Eventually Bitcoins will also replace cash. But it will take time. The current hiccups (MtGox) will slowly vanish, and the currency will stabilize. The law enforcement personnel and banks will come to accept the fact they cant fight the public or they will have to ban the internet – which cant happen in democratic states. Then they will find the way to develop regulations that will allow Bitcoins to become legitimate part of the system.

Till then – Bitcoiners will have to lead the way and take the burden of volatility.

We also note the comments of Eli Bejerano, CEO of Israeli Bit2C:

What can we understand about the Bitcoin from the warning?

“Virtual currency” is not legal tender – no central bank or country has control of it.

Risk management by financial institutions – That is, bank transfers must be respected, and if the bank * suspect * laundering or terrorist financing, please report to the Authority.

Fraud and deceit – Meaning you can pay with Bitcoin.

Criminal Buyers – Means that there is no reason not to run a trading platform for legitimate need.

For summary – you can keep using and trading Bitcoins, but know, you have to be careful. Do not expect the Bank of Israel to save you in Bitcoin mistakes.

Bejerano concluded by stating that “Although the Israeli market cannot influence the price, I think it will have a good effect on the Israeli Bitcoin ecosystem. ”