Former Bank of Israel Deputy Governor Criticizes Netanyahu's Crypto Sanctions Idea
Translated & summarized from Globes by baba
Former Bank of Israel Deputy Governor Nadine Baudot-Trajtenberg criticized Prime Minister Benjamin Netanyahu's idea of using cryptocurrency to bypass sanctions, calling it "miserable" and associating it with illicit activities. She warned of potential international boycotts against Israel due to its handling of the conflict, urging internal political change. While some market participants noted that defense companies still receive orders despite boycott threats, the risk is considered in investment decisions. Both speakers acknowledged market volatility and discussed economic challenges, with Baudot-Trajtenberg expressing optimism about Israel's resilience.
The story in 6 lines · by baba
- Former Bank of Israel Deputy Governor Nadine Baudot-Trajtenberg criticized Netanyahu's crypto sanctions evasion idea.
- Baudot-Trajtenberg warned of potential international boycotts against Israel if internal political changes are not made.
- She called the proposal to bypass sanctions with crypto "miserable" and linked to illicit activities.
- Market participants noted that defense firms still receive orders despite boycott threats.
- Speakers discussed market volatility and economic challenges facing Israel.
- Baudot-Trajtenberg expressed overall optimism about Israel's economic resilience.
Dr. Nadine Baudot-Trajtenberg, former Deputy Governor of the Bank of Israel, strongly criticized Prime Minister Benjamin Netanyahu's proposal to bypass international sanctions using cryptocurrency. Speaking at a Globes conference, she stated that the only entities using crypto to circumvent sanctions are involved in illicit activities like drug and organ trafficking, questioning the desirability of such dealings. Baudot-Trajtenberg argued that Netanyahu's pre-election remarks were detrimental to the cryptocurrency field, particularly to stablecoins pegged to the dollar or shekel, which typically require Know Your Customer (KYC) verification and are not used for sanctions evasion. She dismissed the idea of using crypto to bypass sanctions as "miserable," emphasizing that Israel should focus on preventing sanctions rather than associating with criminals.
Baudot-Trajtenberg also issued a broader warning about the Israeli economy facing potential boycotts. She noted that while globalization has slowed, Israel is increasingly subject to expected and covert boycotts, with specific lists already prepared, particularly in the UK. She cautioned that without internal political change and improved management of the conflict, Israel could face significant economic repercussions from a wave of anti-Israel activities. Shimon Uliel, representing Altshuler Shaham, offered a slightly different perspective on boycotts, particularly concerning the defense industry, suggesting that despite public threats, defense companies continue to receive orders. However, he acknowledged that institutional investors like Altshuler Shaham factor boycott risks into their investment decisions.
Regarding potential cuts to U.S. military aid, Uliel downplayed its direct economic impact, noting it represents less than 1% of Israel's GDP and could foster greater independence. Baudot-Trajtenberg agreed that a gradual reduction is manageable but highlighted the severe negative signal such a move would send, indicating a loss of American support in a dangerous world. Both speakers addressed market volatility following recent elections in Israel and the U.S., attributing it to political uncertainty, potential aid cuts, and shifts in tech stocks. They also discussed defense stocks, real estate, and the Israeli shekel, with Baudot-Trajtenberg expressing overall optimism about Israel's future economic resilience despite challenges.