A press release issued on November 6th by an Israeli study group, stated their recommendation that Israel’s central bank does not issue its own cryptocurrency token.
In November of 2017 the governor of the Bank of Israel established the interdepartmental team to “examine the issue of central bank digital currencies.” The team’s findings were revealed this week, a year after the teams assembly.
The results of the examination are less than surprising. Israel has decided to follow in the footsteps of its neighbors and the EU, under the belief that there are not “proper grounds for a decision to recommend issuing digital currency.”
The report states,
“Central banks around the world are examining the possibility of issuing digital currency and/or using distributed technologies in the payment systems, but no advanced economy has yet issued digital currency for broad use.” continuing on to say:
“The team does not recommend that the Bank of Israel issue digital currency in the near future. It is necessary to continue examining the field and to follow developments around the world before there are proper grounds for a decision to recommend issuing digital currency. The team will continue working to study and monitor the issue, and will report to the Bank of Israel’s management semi-annually about its activity and about significant developments in the field.”
Though most countries are leaning away from issuing any central bank digital currencies (CBDC’s), not all countries are. Recent activity has shown that China, Sweden, and Canada’s central banks are all further exploring the possibilities of issuing a digital currency.
One main concern countries who are looking into issuing a CBDC, including Israel, is the effect doing so will have on the economy and the banks financial system itself. Israel’s study group states their concerns eloquently.
“it is expected that the issuance of CBDC will have an impact on the central bank as it issues and manages cash and conducts monetary policy, and on the payments system.”