Yes, Hamas was supported, and partially funded, by Israel. In hindsight, it was a mistake. But honestly, what the hell did Israel think was going to happen. Israel openly supported Hamas because they wanted to dispose of Fatah, which was the bulk of the PLO. The difference between Fatah and Hamas, Fatah was a secular organization, Hamas is a religious one, kind of a Sunni based Taliban if you will.
And that is just it. Israel was formed, not as a religious nation, but a secular one. Yes, it was created as a "safe haven" for Jews, but for all Jews, not just the orthodox. But ever since the founding the nation has continually moved to the right. Today, ultra-right orthodox Jews hold most of the power, and that is no small reason as to why there have been mass protests in the streets.
It is not just Christians and Muslims that are discriminated against in Israel. It is secular Jews as well. A clear violation of the Universal Declaration of Human Rights, which as a member of the United Nations, Israel is required to follow.