Israeli Prime Minister Benjamin Netanyahu said in a Channel 10 interview on Friday, Oct. 23, that Israel needs to prepare for possible sanctions, including sanctions on its banks, by building an economy that can work around them. Asked whether blockchain is the alternative, he said it is one option and added that he had already asked for a plan to be prepared.
The comments drew immediate pushback from the Bank of Israel, a letter signed by more than 100 economists, and Netanyahu’s main challengers as Israelis head to the polls on Tuesday, Oct. 27.
What Netanyahu said in the interview
The interviewer raised warnings from Britain’s foreign secretary and other governments, along with the risk that any measures could spread into Israel’s financial system.
According to Unchained’s translation from the Hebrew-language exchange, Netanyahu first said Israelis should get used to the end of U.S. military aid to the defense budget. He then turned to sanctions, including sanctions on banks, saying: 「You need to organize yourself with a bypass economy.」 He added that 「you know what the currencies that bypass this are」 and said he was working on that as well.
When asked directly whether blockchain is the alternative to economic sanctions on Israel, Netanyahu answered: 「One of them, certainly, and I have already asked that the plan for this be prepared.」
Bank of Israel and economists reject the idea
On Saturday, the Bank of Israel said cryptocurrencies cannot be used as a route for bypassing sanctions, according to the Times of Israel. The central bank also said the right course for Israel’s economy is to preserve economic relationships with its principal trade partners.
Netanyahu told Channel 14 the same day: 「I hear the resistance; I am taking it into account,」 but said he would do what he thinks is best.
More than 100 economists warned in a letter on Sunday that the plan would cost Israelis jobs and foreign investment, and that crypto would not fix that, Reuters reported. Signatories included former Bank of Israel governor Jacob Frenkel and several Nobel laureates.
Political rivals attack the proposal
Gadi Eisenkot, who leads the Yashar party, wrote on X that 「The BibiCoin vision is a threat to national security,」 according to the Times of Israel.
Opposition leader Yair Lapid said, in remarks reported by Reuters, that Netanyahu was telling voters they would be standing in line for an hour and a half for bread.
Naftali Bennett, who leads B’Yachad, said he was horrified to hear what the Times of Israel described as Netanyahu’s 「defeatist and gloomy vision.」
Critics also point to blockchain traceability
Avigdor Liberman, chairman of Yisrael Beytenu, raised a technical objection on X. As reported by the Times of Israel, he wrote that transactions on blockchain networks are traceable and accused Netanyahu of holding back crypto regulation.
Israeli authorities have acted on that visibility before. In July, Defense Minister Israel Katz signed sanctions against 37 crypto wallets that the National Bureau for Counter Terror Financing tied to Iran’s Revolutionary Guards, JNS reported.
Netanyahu has not published the plan and has not said when it will be ready.
