Bank of Israel: 'We will launch the digital shekel after Western central banks'

The central bank is researching and experimenting, it has a plan of action and it will be implemented when the regulator deems it necessary.

“We are waiting for some Western central bank to pull the trigger, and it will almost certainly be the ECB. This will encourage other countries to launch state-owned stablecoins as well,” Abir said.
The Bank of Israel began exploring the possibility of launching a CBDC to improve payments in the country back in 2017. In November 2020, the BOI's interest in the digital shekel only intensified as the regulator began collaborating on CBDC with the central banks of Hong Kong, Sweden, Norway and the Bank for International Settlements (BIS).
The Bank of Israel has begun testing its own digital currency as part of its Digital Shekel Challenge initiative, inviting traditional and fintech companies into the project to explore potential uses for CBDC.

However, Abir doubts that the public is ready to use the digital shekel. The official noted the gap between theoretical research and practical use of CBDC. According to Abir, the results of some studies encourage people to use the digital currency. However, in practice, citizens must have several options for using CBDC for people to agree to use the digital shekel.

In 2022, the Central Bank of Israel said that the state digital currency should be partially anonymous. Previously, researchers at the Bank of Israel suggested that the transition to the digital shekel would allow for smooth settlements even in the event of circumstances.