A proposal by Prime Minister Benjamin Netanyahu to consider using cryptocurrencies to bypass possible international economic sanctions has drawn a strong backlash in Israel, with 109 economists, business leaders and former government officials, including two Nobel laureates, warning of serious consequences for the country’s economy. In a joint letter made public on Sunday, the signatories described the idea as “bizarre”, noting that such methods are used by criminal organisations, and warned that Israel risks being driven into international economic isolation. They include Joel Mokyr, winner of the 2025 Nobel Prize in Economics, Nobel chemistry laureate Aaron Ciechanover, former Bank of Israel governor Jacob Frenkel and four former directors-general of the Finance Ministry.
Warnings of wide-ranging damage
The authors of the letter warn that large-scale banking sanctions could paralyse international transactions, trigger a mass exodus of investment and hit the technology sector particularly hard, one of the main pillars of the Israeli economy. The consequences, according to the letter, could also reach citizens’ daily lives, causing problems with credit card use and online purchases, as well as with the import of medicines and medical equipment. The Bank of Israel also weighed in, stressing that cryptocurrencies cannot function as a mechanism for circumventing international sanctions and adding that the priority must be to maintain economic relations with the country’s main trading partners. Netanyahu revealed on Friday that he had asked for a plan to be drawn up on the issue. He later clarified that cryptocurrencies are only one of the options under consideration and that it is not certain they will be used. Responding to the central bank’s criticism, he said he listens to advice but ultimately acts on his own judgement.
Source: CNA
