The largest bank in Israel, Leumi, is preparing to enter the encryption business again. According to the arrangements published by the Bank with Galaxy Digital, Leumi and his clients in digital banking, Pepper, will be able to buy, sell and hold bitcoin, Ether and Solana in the future in the Leumi Trade application. The service is expected to be launched early in 2027, but approval from the Central Bank of Israel is still required.
Second advance encryption transaction
This is not the first time Leumi has tried a business. In March 2022, Pepper Invest announced that, in cooperation with Paxos, it planned to open Bitcoin and Ethera to customers and that it would be the first Israeli bank to provide the service. However, due to the lack of regulatory clearance, the relevant plans were ultimately not landed.
The implementer of this cooperation changed to Galaxy. According to the disclosure, both the transaction and hosting infrastructure will be provided by Galaxy, which will be completed through its agency-oriented platform GalaxyOne Industrial, while the hosting will be provided by GK8. GK8 is a digital asset wallet company acquired by Galaxy.
The regulatory environment has changed since 2022.
It was reported that the Israeli banking system had previously been more cautious about encryption-related funds and that banks could delay processing the related deposits and even directly reject funds in French from encryption channels. The range of tokens to be traded by licensed institutions is also narrower, and hosting and capital requirements were once unclear.
This began to change in mid-2026. The Central Bank of Israel eliminated automatic delays in the processing of encrypted-related deposits and no longer allowed banks to reject funds from licensed institutions. At the same time, local capital market regulators have identified wallet security, capital funds and customer asset segregation requirements.
A circular issued on 1 August also expanded the range of tradable tokens to allow the transactions to rank 50 above the market value of $500 million. It was reported that this created a lower level of compliance for banks to provide encrypted transactions to retail customers.
Services will be embedded in existing investment applications
According to the plan, the function would not be independent of the new product, but would be placed directly into the existing capital market applications of Leumi Trade. Clients can manage equities, bonds and digital assets within the same application. Leumi currently has about 2.5 million retail customers, which means that, once approved, its encrypted entry points will be directly linked to a large group of bank customers.
Galaxy also holds the BitLicense and funds transfer license issued by the New York State Department of Financial Services, United States. For Leumi, this means that the cooperating party itself is also under a clearer regulatory framework.
At present, the key variable of this service remains whether or not the Central Bank of Israel approves it. Leumi ' s last encrypted trading plan was at this point, so whether or not to go online at the beginning of 2027 is still dependent on the final release.