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Netanyahu proposes using cryptocurrencies to skirt potential international sanctions

Israeli Prime Minister Benjamin Netanyahu proposed using digital currencies and blockchain to shield the national economy from potential international restrictions. In an interview with Channel 10, the prime minister said the country should prepare in advance for a scenario in which traditional banking is targeted by sanctions and develop alternative cross‑border payment channels. His concern was reportedly prompted by plans in the United Kingdom, France, and Canada to restrict imports from settlements in the West Bank.

The proposal drew strong pushback from the Bank of Israel, which stressed that crypto assets could not substitute for correspondent banking, clearing networks, and the trust of institutional investors. The central bank said authorities should strengthen ties with global partners and avoid isolation rather than seek financial workarounds. More than 100 economists, including former central bank governor Jacob Frenkel and Nobel laureates, opposed the plan in an open letter, warning that resorting to sanctions would lead to lost investment, rising unemployment, and the country becoming more like apartheid‑era South Africa, Iran, or Russia.

The prime minister’s remarks also triggered a wave of domestic political criticism ahead of Knesset elections. His rival, former IDF chief of staff Gadi Eizenkot, called the plan a security threat, saying a shift to cryptocurrency would paralyze the high‑tech sector and deter global corporations. Opposition leader Yair Lapid also condemned the initiative. Experts are unanimous that technology industries depend on seamless integration with global capital and that any disruption to banking operations would inflict lasting damage on the economy.

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