Israel’s central bank is signalling stronger regulatory control over stablecoins as the country advances plans for a digital shekel, marking another step in its push to modernise the financial system.
Officials say clearer oversight is necessary to prevent risks linked to privately issued digital assets, especially those that could affect payment stability, consumer protection and monetary policy. The Bank of Israel has been reviewing new frameworks to supervise how stablecoins are issued, backed and integrated into domestic payment rails.
The move aligns with Israel’s broader digital-currency agenda. Work on the digital shekel has intensified over the past year, with policymakers focusing on security, interoperability and the role of commercial banks in a future CBDC environment. The central bank has also been engaging fintechs and regulators to refine technical models and ensure that the system supports innovation while limiting systemic risks.
Authorities believe tighter rules on stablecoins will help ensure that new forms of digital money operate safely alongside the digital shekel, strengthening trust in Israel’s evolving financial infrastructure.
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