Before Banks Bolt, Netanyahu Wants Israel’s Blockchain Plan B Ready

Israeli Prime Minister Benjamin Netanyahu said he has requested a plan to use cryptocurrency and blockchain networks to counter possible banking sanctions against Israel. In an interview on Israel’s Channel 10, four days before the country votes in a national election, Netanyahu said, “It is only a question of time.” He told Israelis to get used to the idea of not continuing to “receive tens of billions of dollars in American assistance” for the country’s defense budget. He added, “There could be sanctions, including banking sanctions,” and, “You have to prepare an alternative economy and think about currencies that can get around those restrictions. I am working on that as well.”

Asked if blockchain could provide a way around sanctions, Netanyahu said, “Blockchain is one of the alternatives, certainly,” and, “I have already asked for a plan to be prepared for that.” He described crypto and decentralized technologies as alternatives but did not disclose who would prepare the plan, what currency or network it would use or when it would be ready. Israel previously announced plans to launch a CBDC, while the U.S. government already partners with Chainlink to issue economic data onchain.

If approved, Israel would join a small group of countries that have tried similar approaches, including Venezuela, Iran, Russia and North Korea, which have used crypto to move funds outside of America’s intervention. Venezuelan president Nicolas Maduro drew up a plan and designed an accompanying legal system; Venezuela has used Tether and Bitcoin to sustain its oil industry and created the Petro in an effort to push its whole economy outside of SWIFT. Russia tried a similar route with A7A5, a ruble-pegged token from a payments firm co-owned by a sanctioned state bank. It moved about $102 billion in its first year, per Elliptic, before sanctions and a hack of its main exchange cut its daily volume by 96% from its peak.

Iran uses crypto assets such as Bitcoin and USDT to bypass banking sanctions and pay for imports. It also released a Strait of Hormuz insurance proposal earlier this year that would have involved ships paying tolls in crypto for passage through the waterway. Separately, Israel’s largest bank, Bank Leumi, plans to offer Bitcoin trading in early 2027 through Galaxy Digital, pending Bank of Israel approval. Banking sanctions mean foreign banks refuse to process payments for a country’s banks, making it harder for importers to pay suppliers and eventually pushing up prices at the supermarket.

More than 60 Israeli economists and former officials warned this week that measures now aimed at West Bank settlements could spread to the wider economy and raise the cost of living, per Ynet. The U.K. banned imports from Israeli settlements in early September and announced sanctions on people and companies involved in building them. Eleven other countries, including France and Canada, said they intend to restrict trade in settlement goods. The pressure follows the war in Gaza. A UN commission of inquiry — an independent panel that does not speak for the UN itself — concluded in September 2025 that Israel was committing genocide there.