Israel’s Largest Bank Will Give Bitcoin Trading Another Try
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- Bank Leumi is partnering with Galaxy Digital to offer Bitcoin, Ether, and Solana trading inside its Leumi Trade app through its Pepper digital banking arm, targeting an early 2027 launch pending Bank of Israel approval.
- The move is Leumi's second crypto attempt after a March 2022 plan with Paxos that collapsed because the Bank of Israel never granted the required regulatory sign-off.
- Galaxy Digital will provide both halves of the stack—execution via its GalaxyOne Institutional platform and custody through GK8, an air-gapped wallet infrastructure it acquired after Celsius's collapse—and holds a New York DFS BitLicense plus a money-transmission license obtained in May 2026.
- Mid-2026 regulatory shifts cleared the path: the Bank of Israel removed automatic deposit delays on crypto-linked funds and barred blanket refusals, while the Capital Market Authority set capital requirements of 2 million NIS for non-custody firms and 2.5 million NIS with custody.
- An August 1 circular opened trading to the top 50 coins by market cap above a $500 million threshold, creating what the deal positions as Israel's first bank-direct, regulated on-ramp to crypto for retail customers.
- Leumi serves roughly 2.5 million retail customers, all of whom could eventually access crypto from the same app they already use for stocks and bonds.
- "The future of finance will run on open, programmable rails, and we believe the banks that move first will define the era that follows," said Lior Lamesh, CEO of Galaxy Israel.
Why it matters: Israel's biggest bank is betting its 2.5 million retail customers will buy crypto inside a regulated app rather than on offshore exchanges—a test case for whether mainstream banks can absorb digital assets once regulators stop blocking the door. The 2022 Paxos failure shows the same Bank of Israel gate still controls Leumi's fate.
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