The Central Bank of Israel has begun to actively explore the possibility of issuing its own digital currency, and has also identified the goals and benefits of the digital shekel.
Previously, the central bank was opposed to the launch of such assets, believing that they carry many risks and can pose a threat to the financial system. Deputy Governor of the Central Bank of Israel Andrew Abir said that the bank was forced to change its policy regarding national digital currencies, given the interest of other central banks in state stablecoins.
Bank of Israel Governor Karnit Flug said the regulator is at the stage of exploring options for using the digital shekel, and even created a special working group for these purposes. However, Flug stressed that the central bank has not yet given final consent to the launch of the digital shekel. At least it shouldn’t be expected in the coming years.
Nevertheless, researchers from the Central Bank of Israel called the benefits of issuing a digital currency. First of all, it can become an efficient and secure alternative to the existing means of payments, so that financial systems can better adapt to the digital age. The transition to digital shekel will also allow for uninterrupted settlements even in the event of any disruptions or unforeseen situations.
Bank of Israel researchers also concluded that using the state cryptocurrency, international payments will be made much cheaper and faster, while maintaining a certain level of privacy for users. The digital shekel will also reduce the use of cash and help the government fight the shadow economy.
Recall that this month the central banks of Georgia and Kazakhstan also began to study the possibility of launching their own digital currencies in order to increase the availability of financial services for the population.