In 2017, a report had it that the Bank of Israel commissioned a research targeted at monitoring how feasible it will be to issue a Central Bank digital Currency (CBDC) in the country. The result of the research done by the bank was eventually released. So far the research has shown that the proposed Digital currency did not meet up to expectations, as it has been found unsuitable in certain areas. The Israeli central bank has been advised to stop the issuance of this CBDC till further notice.
Central Bank digital Currency (CBDC)
Based on a previous report it was made known that the Bank of Israel along with a joint team from the Israeli finance ministry had a meeting. The meeting was supervised by Karnit Flug, the outgoing BoI Governor. The meeting was centred on discussing the advantages and disadvantages of issuing a cryptocurrency which is Israel based, called the Central Bank digital Currency (CBDC).
At the meeting, they were able to come up with some potential positive advantages the Digital Shekel will provide. It was said that the Digital Shekel will provide access to faster payment for transactions made with it, and help improve the Country’s economy. In turn, the token will increase the tax return of the Country.
Issuance of Token Proposed till Further Notice
Report from a recent announcement about the proposed coin made it known that results from the research conducted clearly suggests that the token remain suspended till further notice. However, the chances of issuing the cryptocurrency are still quite high.
The report also stated that:
“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 report further made it known that the introduction of a Central Bank digital Currency is likely to bring out some risks and difficulties. These suspected risks may end up impacting the country’s financial system.