Overview
- Netanyahu told Channel 10 on October 23, 2026 that he fears possible banking sanctions and has asked officials to prepare a plan for an 'alternate' economy that could include blockchain and digital assets.
- Israel already has early building blocks for a digital route, including BILS, a shekel-backed stablecoin approved in April that runs on Solana, and recent Bank of Israel guidance easing banks' dealings with virtual currencies under Directive 411.
- U.S. and enforcement precedents show crypto rails can be cut off because issuers, exchanges and custodians can freeze addresses and regulators such as OFAC can sanction token projects, as seen when Tether froze funds after the Garantex shutdown and when OFAC sanctioned a ruble-backed issuer.
- Major practical gaps remain because any real bypass must solve on‑ and off‑ramps, trade settlement, foreign‑currency access and formal banking ties, and it is not yet clear which ministry or agency will write the plan or what legal and operational safeguards it would include.
- If carried forward the plan could shift how Israelis and exporters move money but would probably increase friction with global banks and regulators and hinge on whether international actors accept or block the new mechanisms.