Israel starts digital shekel pilot

As a crypto investor with a background in the Israeli tech industry, I’m excited about the Bank of Israel’s Digital Shekel Challenge. This initiative represents a significant step forward for the Israeli ecosystem, potentially bridging the gap between the web3 industry and government.

The Bank of Israel is initiating the Digital Shekel Contest, encouraging various industries to create proposals for a prospective digital currency overseen by the central bank.

The Bank of Israel is taking steps to advance its digital currency, referred to as the digital shekel, by introducing the “Digital Shekel Initiative.” This project is designed to investigate the feasibility and practical uses of a central bank digital currency (CBDC) through collaborative efforts.

As an analyst, I’ve come across a noteworthy announcement from the Bank of Israel. They plan to experiment with their digital currency, the digital shekel, by creating a technological prototype. This prototype will mimic the fundamental workings of the digital shekel and its Application Programming Interface (API) layer.

As a crypto investor, I believe the key to the digital shekel’s success lies in a strong partnership between the Bank of Israel, local businesses, and the government. By embracing this endeavor together, we open up opportunities for financial institutions from Israel and around the world, as well as various payment system stakeholders, to actively contribute to the conceptualization and development of the digital shekel. Through this collaborative effort, we can create an innovative and effective digital currency that caters to the needs of our diverse economy.

Andrew Abir, deputy governor of the Bank of Israel.

In the pilot program, individuals involved will be required to create diverse scenarios for employing the digital shekel, leveraging the provided API. The focus will be on novel and inventive payment applications, which may either improve current structures or present groundbreaking alternatives.

Shauli Rajwan, the founder and managing partner of Masterkey VC, a crypto investment firm, anticipates that the Bank of Israel will prioritize approaches utilizing micropayments, digital trusts, and data products in their upcoming program. He further mentioned that this initiative would be divided into three stages: the initial phase for applications and presentations, followed by access to the new network for selected projects, and concluding with a final pitch session before esteemed judges, some of whom have previously graced crypto conferences with their presence.

“This undertaking marks a substantial advancement for the Israeli tech scene, with the possibility of fostering collaboration between the web3 sector and the government. However, it’s important to note that decentralized finance and permissionless solutions have yet to be included in the discussion.”

Shauli Rajwan

As a researcher engaged in the field, I can share that my team at the Bank of Israel embarked on an exploratory journey into the world of Central Bank Digital Currencies (CBDCs) back in 2017. Our initial focus was on deciphering global trends related to digital currencies, assessing the technological feasibility, and evaluating potential implications for monetary policy and financial stability. Fast forward to 2021, our team’s commitment intensified with the creation of a dedicated task force. We are now delving deeper into the development of the digital shekel, ensuring we stay at the forefront of this evolving landscape.

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2024-05-29 09:48