On 29 June 2026, the Israeli Ministry of Finance and the Capital Market, Insurance and Savings Authority (CMISA) jointly published a draft bill on the issuance of stable digital currencies for public comment. The bill represents the first proposal for a licensing and supervision regime for stablecoin issuers in Israel. The draft was prepared over more than a year with the involvement of the Chief Economist's Department and the Bank of Israel and will proceed through three Knesset readings before it can take effect as binding legislation.
The draft bill grants CMISA licensing and supervisory powers over any entity seeking to issue or distribute a stable digital currency to users in Israel. Applicants must meet minimum capital requirements, maintain reserves at a 1:1 ratio in segregated bank accounts or equivalent regulated custodial arrangements, and submit to periodic reporting and on-site CMISA inspection. Mandatory disclosures cover reserve composition, redemption mechanics, and risk factors. The draft incorporates reserve architecture from the US GENIUS Act and the issuer oversight provisions of MiCA Title III and Title IV, which regulate asset-referenced tokens and electronic money tokens within the EU.
Israeli banks, payment service providers, and fintech operators proposing to issue or distribute stablecoins must obtain a CMISA licence before the mandatory regime takes effect. Foreign stablecoin issuers serving Israeli users must assess whether their instruments fall within the draft bill's definition of a stable digital currency, which covers instruments pegged to a single fiat currency, a basket of currencies, or a commodity. Exchanges, custodians, and wallet providers listing or holding in-scope instruments should anticipate consequential obligations under existing Payment Services Law amendments expected to accompany the bill through the Knesset.
The draft is at the public comment stage and cannot be enforced until all three Knesset readings are complete, which industry participants estimate could occur in late 2026 or early 2027. In parallel, CMISA has already approved BILS, a shekel-backed stablecoin on Solana, under a two-year pilot that operated ahead of formal legislation. That pilot structure is expected to transition into the new licensing regime once enacted. Firms with current Israeli user bases who are not operating under the BILS pilot should monitor the Knesset legislative calendar for the timing of the second and third readings.
Licentium advises crypto firms, payment institutions, and fintech businesses on stablecoin regulatory compliance across Israel, the EU, the UK, and other jurisdictions. Work we undertake includes MiCA authorisation planning, GENIUS Act compliance analysis, stablecoin reserve management structure design, cross-border stablecoin product structuring, and regulatory perimeter analysis for new issuance programmes.