Bank of Israel Releases Preliminary Design for the Digital Shekel: A Deep Dive

Bank of Israel Releases Preliminary Design for the Digital Shekel: A Deep Dive

Key Takeaways:

  • Israel has released the preliminary design for its CBDC, the digital shekel, aiming for a user-friendly and inclusive digital currency.
  • The digital shekel will be able to do transactions offline, offering solutions for areas with network connectivity.
  • A decision on whether to launch the digital shekel will not be made until after 2026, relying on public feedback and further research.

Israel’s central bank has published the digital shekel’s design

In a major step towards exploring the next-generation money, the Bank of Israel has released the preliminary design for its planned central bank digital currency (CBDC), Digital Shekel (DS). And while a hard launch date is still up in the air, this detailed proposal does hint at what the ecosystem and functionalities, as well as technical architecture and regulatory considerations, the bank is considering. This action comes as part of a wider trend of central banks around the world currently considering CBDCs as a means of updating their financial systems and improving payment networks. However, this is an intricate endeavor that requires significant human involvement.

What is Behind Israel’s CBDC Exploration?

According to the Bank of Israel Steering Committee, there are several motivations to implement a Digital Shekel, including:

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