YEREVAN (CoinChapter.com) — The Bank of Israel has released a preliminary design for a digital shekel (DS), detailing its technical framework, ecosystem, and regulatory considerations. The central bank has not committed to issuing the CBDC but continues exploring its potential.
On March 3, the Bank of Israel’s Steering Committee published a report outlining the digital shekel’s functionality, potential benefits, and role in the financial system. The report lists alternative payment methods, cost efficiency, and privacy improvements among the possible advantages. It also mentions the government’s goal of regulating undeclared economic activities.
Digital Shekel to Be Accessible for All
The Bank of Israel states that the digital shekel would be available to all population segments, including children, businesses, foreign visitors, and financial institutions.
“The DS is expected to offer a wide range of benefits to all segments of the population. It will be available to the entire public, including children, foreigners, all types of businesses, public institutions, and financial entities,”
the report states.
The Bank of Israel will issue the CBDC, while private firms will assist with user onboarding, converting deposits, and offering financial services.
Key Features of the Digital Shekel
The digital shekel would support offline transactions, allowing payments without an internet connection. It would also be interoperable with payment networks and digital asset platforms, ensuring users can send or receive DS even if the counterparty does not use the system.
“The DS will be interoperable with other payment systems, allowing users to receive or pay in digital shekel even if the other party to the payment does not use the digital shekel,” the report explains.
Instant settlements are another planned feature, enabling transactions to clear immediately.
Public Feedback on CBDC Development
The Bank of Israel has launched the “Digital Shekel Challenge” to examine possible real-world applications. This initiative invites technologists and businesses to test potential CBDC use cases.
The final decision on the digital shekel is expected after 2026. The central bank will collect public feedback on the CBDC design until April 30, 2025. It will also seek technical input from technology providers to explore possible implementation methods.
