Leumi Bets Big on Digital Assets
Bank Leumi, Israel’s largest lender, is moving forward with plans to offer cryptocurrency trading to its millions of customers.
This marks a significant shift for the institution. In March 2022, Leumi’s digital investment arm, Pepper Invest, had revealed intentions to support BTC and ETH trading via a partnership with Paxos. However, those plans stalled due to unresolved regulatory hurdles at the time. Now, with updated guidance from the Bank of Israel and new standards from the Capital Market Authority—including a 2.5 million New Israeli Shekel capital requirement for custody firms—the path appears clearer for regulated crypto offerings.
Galaxy Digital’s Role: Behind the Deal
Leumi’s crypto trading service will rely on Galaxy Digital’s infrastructure. GalaxyOne Institutional, the firm’s platform for institutional clients, will provide both execution and custody services. The custody side leverages technology previously branded as GK8, which Galaxy acquired to bolster secure storage of digital assets.
Galaxy Digital itself has faced market turbulence: in the second quarter of this year, it reported an $85 million net loss as digital asset prices fell sharply. Despite these losses—and a roughly 25% drop in its share price over the past year—Galaxy continues to expand its global partnerships. Its shares were trading at $21.38 on Friday morning after debuting on Nasdaq under the ticker GLXY in May 2025.
Lior Lamesh, CEO of Galaxy Israel, will oversee local operations for the rollout. On paper, Galaxy’s recent losses might raise concerns about stability; in practice, its regulatory credentials—including a New York DFS BitLicense and a money-transmission license since May 2026—help reassure institutional partners like Leumi.
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Israeli Regulators Yet to Approve
Although Leumi and Galaxy have signed agreements and set a timeline for early 2027, final approval from Israel’s central bank remains pending. Regulatory changes over the past two years have been substantial: by mid-2026, the Bank of Israel lifted deposit delays and prohibited blanket refusals of funds coming from licensed crypto providers.
It’s unclear whether all customer segments will be eligible when the service launches.
In August 2026, regulators issued a circular allowing licensed firms to offer trading in up to 50 cryptocurrencies by market capitalization—provided each has a market cap above $500 million. These rules are designed to both widen access and maintain oversight over riskier assets.
A Second Attempt After 2022 False Start
This is not Leumi’s first attempt at entering crypto markets. Back in March 2022, Pepper Invest tried to introduce BTC and ETH trading via Paxos but never received regulatory clearance. Since then, Israeli authorities have updated their stance: wallet security standards are now set at 2 million New Israeli Shekels for non-custody firms and require strict separation of customer assets from company funds.
Chainalysis data cited by bitcoinmagazine.com shows that crypto adoption in Israel has grown steadily over recent years. Geopolitical uncertainty has reportedly driven some Israelis toward digital assets as alternative stores of value—a trend that may accelerate if major banks like Leumi go live with regulated offerings.
What’s Missing: Fee and Access Details
While Leumi has confirmed its partnership with Galaxy Digital and outlined which coins will be available (BTC, ETH, SOL), several details remain undisclosed. The companies have not shared information about commercial terms or fee structures for users who trade through the Leumi Trade app or Pepper platform.
Maya Ravia, Leumi’s head of strategy, is expected to clarify eligibility criteria closer to launch. For now, it is uncertain whether business clients or only retail customers will gain access initially—or how transaction costs will compare to those on global crypto exchanges.
Key points still in play
Bank Leumi’s crypto trading service with Galaxy Digital is scheduled to launch in early 2027, but its rollout remains contingent on Bank of Israel approval, which is not yet confirmed; if regulatory clearance is granted, Leumi customers will immediately gain access to buy, hold, and sell bitcoin, ether, and solana through the Leumi Trade app.
