Netanyahu Proposes Blockchain as Strategy Against Potential Financial Sanctions in Israeli Elections

Netanyahu envisions cryptocurrencies as a countermeasure to sanctions pressures.

In an interview with a local TV host, Netanyahu revealed that Israel is actively investigating blockchain technology and digital currencies as tools to bypass potential banking restrictions imposed internationally.

He described blockchain technology as an 'alternative to sanctions' during a discussion on Israel’s Channel 10 economic network on Friday.

By labeling blockchain a 'national strategic tool,' Netanyahu indicated a shift in the government's approach toward digital currencies — moving from viewing them solely as an investment opportunity to integrating them within the country’s economic defense framework, as noted by CryptoJungle, Israel’s leading crypto media outlet.

About a dozen Western nations have imposed sanctions targeting products from Israeli settlements in the West Bank, responding to settler violence against Palestinians and expanding settlements approved by Netanyahu’s right-wing administration. Economic analysts and sector professionals warned last month that such sanctions might extend to encompass Israel itself.

Several political contenders aiming to replace Netanyahu in the October 27 elections, alongside the head of the Bank of Israel, swiftly condemned the prime minister’s remarks.

Yashar party leader Gadi Eisenkot criticized the proposal on Saturday morning via X (formerly Twitter), calling the notion of 'BibiCoin' a security risk. The Bank of Israel also issued a statement dismissing the idea, asserting that cryptocurrencies 'cannot serve as a method to circumvent sanctions.'

MoonPay’s acquisition of crypto security firm Sodot, backed by a $100 million investment targeting institutional crypto markets, has been highlighted as a notable development in the broader landscape.

Strong public and media backlash followed the announcement regarding blockchain's role in sanctions evasion.

At an anti-government demonstration in Tel Aviv on Saturday evening, some participants voiced their disdain over Netanyahu’s blockchain comments.

Aryeh Cohen, holding a sign reading 'enough Bibi’s B.S.' in English, stated, 'An economy that operates on the dark web does not make us any better than our adversaries.' Another protester, Pnina, told Cointelegraph that such measures could push the Bank of Israel 'outside the law.'

Media outlets and commentators also voiced sharp criticism against the idea of leveraging cryptocurrencies to avoid sanctions.

Yediot Ahronot columnist Nadav Eyal pointed out on X that while digital currencies can transfer value outside certain traditional banking paths, they do not replace a country's financial system—they cannot provide banking credit facilities, substitute for international capital markets, or compel foreign companies to defy sanctions prohibiting business with Israel.

Ben Samocha, founder of CryptoJungle, told Cointelegraph that crypto and blockchain-based technologies are not suitable tools for sanction evasion. Drawing on the U.S. Treasury’s experience with Iran, he emphasized that blockchain investigations can track illicit funds, block their conversion into fiat currency, and freeze them. He concluded that Israel’s economy is not structured to bypass sanctions using cryptocurrencies.