The central bank of Israel is yet to make a final decision on the launch of the “digital shekel” the country’s CBDC project, however, the public response to the concept has been mostly positive.
The Bank of Israel summarized the results of the public consultation on its central bank digital currency (CBDC) proposals on Monday, according to Reuters.
It received 33 answers from various sectors, half of which came from outside the country and 17 from the domestic fintech community. It asserted, while stating that the ultimate decision on the project’s destiny had yet to be made:
“All of the responses to the public consultation indicate support for continued research regarding the various implications on the payments market, financial and monetary stability, legal and technological issues, and more.”
While the public is said to believe that the digital shekel will promote competition in the payments business, the privacy issue has resurfaced as a point of contention.
Some critics want that the future currency is completely anonymous, while others argue that anonymity is unrealistic in the fight against money laundering and the illicit market.
The Bank of Israel intends to keep doing research and maintain a “fruitful engagement with all relevant parties at all levels of research and development.”
Elad Mor, the head of worldwide blockchain PR agency MarketAcross, which is based in Israel, told Cointelegraph about the Israeli crypto community’s opinions regarding the digital shekel:
“It feels like most digital shekel CBDC supporters are painting the topic as a broad-strokes adoption narrative. In other words, any crypto adoption is still adoption even if it doesn’t adhere to crypto’s core values like decentralization and anti-institutionalism.”
Not everyone in Israel’s digital finance sector, according to Mor, shared the same goal. Nonetheless, he feels that “bringing crypto to the masses must begin with some institutional and governmental participation.”
About Israel’s CBDC project
The central bank first considered the CBDC initiative at the end of 2017. The research team advised that the initiative be put on hold for the time being, however, the Bank of Israel reintroduced the proposal in May 2021.
It announced in November 2021 that it will speed up research. The Bank of Israel affirmed in March 2022 that the eventual deployment of the digital shekel would not pose a threat to the national banking system.
