Quick answer: On Oct. 24, 2026, the Bank of Israel rejected the Netanyahu crypto plan, saying cryptocurrencies cannot serve as a way around sanctions. Netanyahu had said a day earlier that he ordered a blockchain plan in case banks face sanctions; he replied that he would weigh the criticism but do what he thinks is right.
The Bank of Israel has publicly rejected the Netanyahu crypto plan, saying digital currencies cannot help the country get around international sanctions. The clash came on Saturday, Oct. 24, 2026, three days before Israelis vote in a national election.
It is a rare public split between a central bank and a sitting prime minister. It also puts a familiar crypto question back on the table: can a blockchain really shield a country from the banking system?
What happened with the Netanyahu crypto plan
On Friday, Oct. 23, Prime Minister Benjamin Netanyahu spoke to Israel’s Channel 10 economic network. “You need to prepare an alternative economic system, and you know what that is, and you know which currencies can bypass this, and I’m working on that as well,” he said, according to The Jerusalem Post.
Then the interviewer asked about blockchain. “One of them, certainly. And I’ve already asked for a plan to be prepared for that,” Netanyahu replied. Decrypt and i24NEWS carried the same quote. He did not say who is drafting the plan, which network it would use or when it would be ready.
The remarks followed new sanctions on goods from West Bank settlements. Britain and 11 other Western countries announced them, as The Times of Israel reported. Economists have warned that such measures could spread to the wider economy.
The Bank of Israel pushes back
On Saturday evening, the central bank answered directly. “Cryptocurrencies cannot serve as a means to circumvent sanctions,” it said, per Globes and Ynet. The bank added that the right course is to keep ties with Israel’s main trading partners and focus on preventing sanctions. That task, it said, belongs to the political leadership.
However, Netanyahu did not back down. “I hear the objections and I take them into account,” he told Channel 14. “I thank the Bank of Israel for their advice, but I do what I think is right.” He also said crypto “is not the sole method, and it is not certain that it will actually be used,” Globes reported.
Meanwhile, Ynet reported that officials in the economic ministries knew of no such plan. Even senior figures in the Prime Minister’s Office said they knew of no team working on it.
Why the Netanyahu crypto plan matters for crypto
First, the idea runs into how public blockchains work. Bitcoin, Ethereum and Tron record every transfer on an open ledger. As a result, analytics firms can follow funds from wallet to wallet. We have seen that tracing at work in cases such as the U.S. crackdown that froze $833 million tied to scams.
Second, crypto still needs a bridge to real money. Yair Avidan, a former supervisor of banks at the Bank of Israel, made this point to Ynet. “A blockchain network does not operate unilaterally,” he said. Payments still need banks, payment firms and trading partners, and all of them must follow sanctions law.
Third, dollar stablecoins carry their own control point. Tether, for example, can freeze USDT held at a given address. In fact, the stablecoin issuer is already under scrutiny in Washington, as we covered in our report on the Senate probe into Tether.
Data and context: what happened to Russia’s sanctions token
Russia offers the clearest test case. A7A5 is a ruble-pegged stablecoin backed by a sanctioned Russian state bank. In its first year, it moved more than $102 billion across about 251,000 transactions, according to Elliptic.
After that, the U.S., the U.K. and the EU targeted the token and its trading venues. By June 2026, its average daily volume had fallen to $24.3 million, down 96% from its July 2025 peak, Elliptic found. CoinDesk reported the same 96% drop. In short, open ledgers made the token easier to isolate, not harder.
For scale, the wider market is far bigger than any single sanctions token. At 19:55 UTC on Oct. 24, CoinGecko showed Tether’s USDT market value at about $182.5 billion. Bitcoin traded at $80,448, down 0.9% in 24 hours, while Ether was at $2,337, down 2.4%. Crypto is also already reacting to Middle East risk, as our story on Bitcoin slipping below $80,000 shows.
What to watch next
- The Oct. 27 election. The plan’s future depends on who forms the next government. So far, it remains an idea in an interview, not a policy.
- Any written proposal. A real plan would need a named team, a chosen network and rules for banks. None has been published.
- Sanctions on banks. Current measures target settlement goods. Wider banking sanctions would change the stakes for Israel’s financial system.
- Local crypto firms. Israel’s Crypto Companies Forum said it is ready to work with the government. Still, its CEO stressed that public blockchains are transparent, not a place to hide money, per The Jerusalem Post.
Netanyahu crypto plan FAQ
What is the Netanyahu crypto plan?
On Oct. 23, 2026, Benjamin Netanyahu said he had asked for a plan to use blockchain as one alternative if Israeli banks face international sanctions. He gave no details on the network, the team or the timing.
Why did the Bank of Israel reject it?
The central bank said on Oct. 24, 2026, that cryptocurrencies cannot serve as a way to circumvent sanctions. Instead, it urged leaders to keep ties with trading partners and prevent sanctions.
Can crypto be used to avoid sanctions?
Only to a limited extent. Public blockchains are traceable, stablecoin issuers can freeze funds, and cash-out still runs through regulated firms. Russia’s A7A5 token lost 96% of its daily volume after Western sanctions, per Elliptic.
Not financial advice. Crypto assets are volatile; do your own research (DYOR) before you trade.
Sources
- Globes: BoI slams Netanyahu’s crypto plan for evading sanctions
- Ynet: Bank of Israel rejects Netanyahu’s crypto plan
- The Jerusalem Post: Netanyahu warns of banking sanctions, plans alternatives
- The Times of Israel: Netanyahu says Israel should ready for sanctions, use blockchain
- Decrypt: Netanyahu considering crypto plan to dodge banking sanctions
- i24NEWS: Netanyahu eyes crypto to counter sanctions
- Elliptic: The fall of A7A5
- CoinDesk: The data dispute over Russia’s A7A5 stablecoin
- CoinGecko: Tether price and market data
