Netanyahu asks for plan to use crypto to dodge possible banking sanctions

Israeli PM says country must prepare for life without US military aid as election approaches

By LineZotpaper AI staff

Published23 October 2026

Read Time3 min

Israeli Prime Minister Benjamin Netanyahu said he has asked for a plan to use cryptocurrency and blockchain networks to help Israel get around possible banking sanctions, warning that American military aid will eventually end. He spoke in a televised interview four days before Israel's national election.

Israeli Prime Minister Benjamin Netanyahu has asked for a plan to use cryptocurrency and blockchain networks to help Israel work around possible banking sanctions, warning Israelis that American defense aid will not last forever.

In an interview on Channel 10, four days before Israel's October 27 election, Netanyahu said the United States would eventually stop providing military funding. "It is only a question of time," he said, telling Israelis to get used to not "receiving tens of billions of dollars in American assistance" for the defense budget. The current US$3.8 billion-a-year aid agreement expires in September 2028.

"There could be sanctions, including banking sanctions," he said. "You have to prepare an alternative economy and think about currencies that can get around those restrictions. I am working on that as well." Asked whether blockchain could be a way around sanctions, he said: "Blockchain is one of the alternatives, certainly. I have already asked for a plan to be prepared for that."

He did not say who is drafting the plan, which currency or network it might use, or when it would be ready. Countries including Venezuela, Russia and North Korea have used crypto to move funds outside the US financial system. Venezuela created its own state-backed token, while Russia's ruble-pegged token A7A5 moved about US$102 billion in its first year before sanctions and a hack cut its daily volume by 96%, according to blockchain analysis firm Elliptic.

The comments came as more than 60 Israeli economists and former officials warned this week that measures aimed at West Bank settlements could spread to the broader economy and raise the cost of living. The United Kingdom banned imports from Israeli settlements in September, and 11 other countries, including France and Canada, said they intend to restrict trade in settlement goods. The pressure follows the war in Gaza; a UN panel concluded in September 2025 that Israel was committing genocide there, and the International Criminal Court issued arrest warrants in November 2024 for Netanyahu and former defense minister Yoav Gallant over alleged war crimes.

Netanyahu also tied Israel's markets to the US election. "The markets know that if I win, we will proceed together with President Trump," he said. "I want independence in weapons production, just as I wanted energy independence." He named India's Prime Minister Narendra Modi as a partner discussing production cooperation.

The report notes crypto is not an easy escape from sanctions, because blockchains are public and traceable. Israel's defense ministry signed sanctions orders on 37 crypto wallets in July that it says belong to Iran's Revolutionary Guards, with an official saying there is "no immunity for terror financiers even in the crypto sphere." Tether, issuer of the USDT stablecoin, can freeze wallets and has done so in coordination with US authorities.

Analysis

Why This Matters

Netanyahu is preparing for a future in which Israel cannot rely on US military funding or financial access, a notable shift in a decades-long alliance.
Using crypto and blockchain to dodge banking sanctions would place Israel alongside Venezuela, Russia and North Korea, countries that have used digital assets to move money outside the dollar system.
The plan lands days before a national election and as international pressure over settlements and the Gaza war grows.

Background

Israel receives about US$3.8 billion a year in US military aid under an agreement that runs to September 2028. Banking sanctions work when foreign banks refuse to process payments for a country's banks, making it harder for importers to pay suppliers and eventually pushing up prices. Some sanctioned countries have turned to cryptocurrencies, though public, traceable ledgers and stablecoin issuers' ability to freeze funds make evasion difficult.

Key Perspectives

Benjamin Netanyahu: Says sanctions, including banking sanctions, are possible and Israel must prepare an alternative economy, including blockchain-based currencies, and seek independence in weapons production.
More than 60 Israeli economists and former officials: Warn that measures now aimed at West Bank settlements could spread to the wider economy and raise the cost of living.
Israel's defense ministry: Signed sanctions orders on 37 crypto wallets it says belong to Iran's Revolutionary Guards, with an official saying there is "no immunity for terror financiers even in the crypto sphere."
Elliptic: Says Russia's ruble-pegged token A7A5 moved about US$102 billion in its first year before sanctions and a hack cut its daily volume by 96%, illustrating the limits of crypto as a sanctions workaround.

What to Watch

The October 27 Israeli election result and whether Netanyahu remains in power to pursue the plan.
Any details of the plan itself: which currency or network, who is drafting it, and when it might be ready.
Whether sanctions on Israel materialize and whether the September 2028 aid expiry becomes a point of tension in US-Israel relations.

Sources

Netanyahu Considering Crypto Plan to Dodge Banking Sanctions on Israel · Decrypt

Checked

12 claims in this story checked against 1 source: 8 supported.

Show each claim

SupportedNetanyahu asked for a plan to use crypto and blockchain to get around possible banking sanctions.Decrypt: “Netanyahu said he has asked for a plan to use cryptocurrency and blockchain networks to help Israel get around possible banking sanctions.”
SupportedNetanyahu said American military aid would eventually end as Israel’s election approached.Decrypt: “Netanyahu said on Israeli television that he has asked for a plan to use blockchain to get around possible banking sanctions. He told Israelis U.S. defense aid will end”
Partly supportedNetanyahu told Israelis to get used to not “receiving tens of billions of dollars in American assistance.”Decrypt: “telling Israelis to get used to the idea of not continuing to “receive tens of billions of dollars in American assistance””
SupportedNetanyahu said, “It is only a question of time.”Decrypt: ““It is only a question of time.” he said”
SupportedNetanyahu said, “There could be sanctions, including banking sanctions.”Decrypt: ““There could be sanctions, including banking sanctions,” he continued.”
SupportedNetanyahu said, “Blockchain is one of the alternatives, certainly” and that he had asked for a plan.Decrypt: ““Blockchain is one of the alternatives, certainly,” Netanyahu said when asked if it could be a way around sanctions. “I have already asked for a plan to be prepared for that.””
SupportedThe current US$3.8 billion-a-year aid agreement expires in September 2028.Decrypt: “the current $3.8 billion-a-year deal expires in September 2028”
SupportedThe interview was four days before Israel’s October 27 election.Decrypt: “He made the comments in an interview on Israel’s , four days before the country votes in a national election.”
Partly supportedRussia’s ruble-pegged A7A5 moved about US$102 billion in its first year, before sanctions and a hack cut its daily volume by 96%.Decrypt: “It moved about $102 billion in its first year, per, before sanctions and a hack of its main exchange cut its daily volume by 96% from its peak.”
Partly supportedVenezuela, Russia and North Korea have used crypto to move funds outside the US financial system.Decrypt: “including Venezuela, , Russia, North Korea, all of which have used crypto to move funds outside of America’s intervention.”
Partly supportedA UN panel concluded in September 2025 that Israel was committing genocide in Gaza.Decrypt: “A UN—an independent panel that does not speak for the UN itself—concluded in September 2025 that Israel was committing genocide there.”
SupportedIsrael’s defense ministry signed orders on 37 crypto wallets in July that it says belong to Iran’s Revolutionary Guards.Decrypt: “On July 1, Defense Minister Israel Katz signed sanctions orders on 37 crypto wallets holding more than 24 million shekels that Israel says belong to Iran’s Revolutionary Guards”