Netanyahu Floats Blockchain as Shield Against Potential Financial Sanctions

Israeli Prime Minister Benjamin Netanyahu said Israel is exploring blockchain technology and cryptocurrencies as a way to reduce the economic impact of potential international financial sanctions. Speaking to Channel 10’s economic network ahead of the Oct. 27 elections, he called blockchain an “alternative to sanctions” and a “national strategic tool.”

Netanyahu’s comments came as a dozen Western countries announced sanctions on goods from Israeli settlements in the West Bank. The measures were introduced in response to settler attacks on Palestinians and increased settlement construction approved by his right-wing government, and economists have warned that broader sanctions could extend to Israel itself.

The proposal drew immediate criticism. Bank of Israel governor Moshe Kaplan said cryptocurrencies cannot be used to bypass sanctions. Gadi Eisenkot, leader of the Yashar party, wrote on X that the “BibiCoin vision” threatened national security, while protesters at an anti-government rally in Tel Aviv also criticized the idea. “An economy that runs on the dark web makes us no better than our enemies,” attendee Aryeh Cohen said.

The debate marks a shift in Israel’s approach to crypto, moving digital assets from the sidelines of financial and technology policy toward a proposed role in broader economic defense. However, the Bank of Israel’s rejection underscores the practical and legal limitations of using blockchain-based financial systems to circumvent sanctions.