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Netanyahu seeks blockchain plan for possible sanctions

October 26, 2026

Israeli Prime Minister Benjamin Netanyahu said Israel is examining cryptocurrency and blockchain as part of contingency planning for possible international banking sanctions, according to accounts of a Channel 10 interview aired on Friday, 23 October. The comments, delivered days before a general election, drew a rebuke from the Bank of Israel and criticism from political opponents.

What happened

Netanyahu told the Channel 10 economic network that banking sanctions were a real possibility and that Israel should prepare an alternative economic framework able to operate around them, The Times of Israel and Globes reported. He said he was already working on that preparation.

When the interviewer asked whether blockchain was the intended alternative, Netanyahu said it was one option and that he had already asked for a plan to be drawn up, according to Globes. Reuters reported that he confirmed cryptocurrency was what he had in mind and treated blockchain technology as a further possibility. He gave no network, asset, budget, or timetable. The Block noted that he also did not say who would write the plan.

In the same appearance he warned that large U.S. military aid packages would not continue indefinitely, telling viewers to get used to that change because, in his account, American politics had shifted rather than Israeli policy, The Times of Israel reported.

The Bank of Israel answered on Saturday. It said cryptocurrencies “cannot serve as a means to circumvent sanctions,” Globes reported, and that the right course was to keep economic ties with main trading partners and to concentrate on preventing sanctions. The bank said that task belongs to the political leadership. On Channel 14 the same evening, Netanyahu said he had heard the objections and was taking them into account, while adding that crypto was one method among others and that it was not certain it would be used. He said he would do what he thought was right, according to Globes.

Why it matters

The interview arrived four days before Israel’s Knesset election on Tuesday, 27 October, and against a backdrop of Western steps aimed at West Bank settlement trade. The Times of Israel reported that Britain and 11 other countries had announced measures on goods from settlements after settler attacks and further construction approved by Netanyahu’s government. Reuters, describing a related move, reported that Britain, France and Canada said last month they would block imports from Israeli settlements, calling it the latest in a series of actions tied to settlement policy.

Those steps are not banking sanctions. Reporting has still treated them as a sign of narrower diplomatic room. A senior Israeli economic official, quoted by Channel 12 and relayed by The Times of Israel, said the crypto idea would not achieve its goal and that merely discussing it could harm the economy.

Opposition leader Yair Lapid wrote that Netanyahu was now admitting, in Lapid’s reading, that a re-elected government would see U.S. security aid end and Israel face sanctions that would damage the economy, The Times of Israel reported. Yair Golan, leader of the Democrats, called the performance detached and said the way to avoid sanctions was to change policy and preserve alliances, according to the same report.

For crypto markets, the practical takeaway is limited. The prime minister described an exploration and a request for a plan, not a launched system. The central bank’s response restates a constraint that already shapes cross-border digital-asset use: alternative payment channels do not, by themselves, remove sanctions screening, correspondent-banking risk, or the traceability of many public ledgers.

What's next

The election on Tuesday will decide whether Netanyahu remains in office to pursue the idea. Even if he does, no implementing agency, statute, or technical design has been published. Reuters reported that economists have warned the plan risks economic isolation, and that political rivals have also criticized it.

Any later proposal would still have to answer the Bank of Israel’s objection and the fact that Netanyahu himself has said use of crypto is not certain. Until a document appears from a ministry or the central bank, the remarks remain a political signal about sanctions risk, not an operational payments plan.

Sources

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