The Bank of Israel doesn't want private companies to hold over the digital payments network in the country. 
The Bank of Israel says it’s preparing an action plan for the potential allocation of a central bank digital currency, though a formal decision has yet to be produced.
On April 17, the Bank of Israel Steering Committee on the Potential allocation of a Digital Shekel outlined possible scenarios for the development and deployment of a CBDC, a digital shekel called “ SHAKED. ”
It delivered several scenarios that could guide the allocation of a digital shekel, among them was raised stablecoin activity.
raised adoption of stablecoins may “ impair the payment system, ” it remarked, before adding that stablecoins not pegged to the shekel “ might similarly damage the monetary transmission. ”
“At this point, there are no signs of substantial adoption of stablecoins as means of payment in Israel. However, paying habits of the public might change rapidly, for instance in a scenario of issuance by a major private sector entity.”
Another potential driver of CBDC evolution is a decline in the use of cash in Israel, the committee told. While cash is still used in a significant portion of consumer deals in the country, a change in the public’s payment habits may result in a shift away from using central bank fiat, according to the committee.
The Bank of Israel doesn't require this scenario or private entities controlling payments so a CBDC could be the solution.
It similarly told that consideration for the allocation of a CBDC would be made to “ support competition in the payments system and in the financial system in the digital era. ”
If the United States or the European Union issues a CBDC, then this would similarly influence Israel’s decision to deploy one, it stated.
The Bank of Israel Steering Committee rounded that it was monitoring the situation in preparation for advancing the digital shekel.
Related: CBDC will be used for ‘control,’ ECB president admits in vid conversation with fake Zelensky
Israel appears to be shadowing the U.S. in terms of crypto regulation. before this year, the country’s securities regulator offered legislation that would classify crypto assets as securities in the country.
Industry executives have raised concern claiming it could “ kill the industry. ”
(MARTIN YOUNG, Cointelegraph, 2023)