Israel's Digital Shekel Takes Flight: Interest-Bearing CBDC on the Horizon Israel's Central Bank is making waves with its groundbreaking plan to launch an
interest-bearing Central Bank Digital Currency (CBDC), affectionately known as the "digital shekel."
The Bank of Israel (BoI) has laid out an ambitious vision for the
digital shekel, encompassing features like user-friendly wallets and seamless bank payment services.
Privacy-conscious citizens can breathe a sigh of relief, as the BoI pledges to safeguard transactional data and personal information while maintaining
effective oversight.
With a deadline set for December 2024, the BoI is racing against time to finalize the design document, despite ongoing internal discussions and uncertainties.
In a bid to incentivize adoption, commercial banks stand to gain by adding the digital shekel to their liquidity reserves, effectively
waiving interest on this new form of digital cash.
While the digital shekel's journey began in 2021, pilot tests are yet to take off. The BoI had initially hoped that stablecoins would pave the way, but wider adoption signals were needed.
