Israeli Prime Minister Benjamin Netanyahu said in a Channel 10 interview on Friday, Oct. 23, that Israel has to get ready for possible sanctions, including on its banks, by building an economy able to work around them. Asked whether blockchain is the alternative, he said it is one option and that he has already asked for a plan.
Since then, the idea has drawn objections from the Bank of Israel, a letter signed by more than 100 economists, and Netanyahu’s main challengers, with Israelis heading to the polls on Tuesday, Oct. 27.
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What Netanyahu Said
The interviewer raised warnings from Britain’s foreign secretary and other governments, and the risk that measures could spread to Israel’s financial system. In the Hebrew-language exchange, Netanyahu first said Israelis should get used to the end of US military aid to the defense budget. He then turned to sanctions, including on banks: “You need to organize yourself with a bypass economy,” he said, according to Unchained’s translation from the Hebrew, adding that “you know what the currencies that bypass this are” and that he was working on that too.
Asked whether blockchain is the alternative to economic sanctions on Israel, he answered, “One of them, certainly, and I have already asked that the plan for this be prepared” (Unchained’s translation).
The Pushback
On Saturday, the central bank said that cryptocurrencies “cannot be used as a route for bypassing sanctions,” as reported by the Times of Israel, and that “the right thing for Israel’s economy is preserving the economic relationships with our principal trade partners.” Netanyahu told Channel 14 the same day, “I hear the resistance; I am taking it into account,” but said he would do what he thinks is best.
The plan would cost Israelis jobs and foreign investment, and crypto would not fix that, more than 100 economists warned in a letter on Sunday, according to Reuters. Jacob Frenkel, a former Bank of Israel governor, and several Nobel laureates were among the signers.
Gadi Eisenkot, who leads the Yashar party, wrote on X that “The BibiCoin vision is a threat to national security,” as reported by the Times of Israel. Opposition leader Yair Lapid said in remarks reported by Reuters that Netanyahu was telling voters they would be “standing in line for an hour and a half for bread,” while Naftali Bennett, who leads B’Yachad, said, per the Times of Israel, that he was “horrified to hear Netanyahu’s defeatist and gloomy vision.”
What Blockchains Record
Avigdor Liberman, chairman of Yisrael Beytenu, raised a technical objection on X: “Transactions on blockchain networks are traceable,” he wrote, as reported by the Times of Israel, and he accused Netanyahu of holding back crypto regulation.
Israel’s own authorities have acted on that visibility. In July, Defense Minister Israel Katz signed sanctions against 37 crypto wallets that the National Bureau for Counter Terror Financing tied to Iran’s Revolutionary Guards, JNS reported.
Netanyahu has not published the plan or said when it will be ready.
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