In Brief:
- Israel started advancing its plan on its own Central Bank Digital Currency.
- The Bank of Israel is not sure about the issuance of digital money and is investigating the possibility.
Bank of Israel Governor Amir Yaron said that the central bank is speeding up its investigation, research, and preparation for the future issuing of a digital shekel to create a more efficient payments system.
At a conference, Yaron stated that the bank, like other central banks, has yet to decide whether or not to issue digital money and is investigating the possibility.
He stated,”we are committed to being at the forefront of economic and technological knowledge in this field.”
In late 2017, the Bank of Israel began to investigate the idea of creating a central bank digital currency (CBDC), but a year later, a study group recommended against launching a CBDC anytime soon.
The central bank announced in May that it was considering creating a digital shekel once more.
The central bank’s capacity to navigate monetary policy may be harmed when payment mechanisms unrelated to the central bank’s money base emerge, according to Yaron.
He finally added by saying, “therefore, central banks have a unique role to play in preventing fragmentation and ensuring that the payment system becomes even more uniform and efficient. One way to do this is through CBDC.”
In this particular area earlier for its digital currency, the Bank of Israel was looking into the Ethereum system to see if it was worth noticing.
