Bitcoin Leads Three Tokens in Bank Leumi's Israel-First Crypto Debut

Crypto News

Bank Leumi, Israel's largest lender, will become the country's first bank to offer direct cryptocurrency trading after announcing a partnership with Galaxy Digital on August 14, 2026. No Israeli lender has previously allowed customers to complete crypto purchases, sales and custody entirely within its own banking channels. Under the agreement, Leumi customers will be able to buy, sell and hold Bitcoin (BTC), Ethereum (ETH) and Solana (SOL) — a high-throughput altcoin — inside the bank's own applications, with the service targeted to begin in early 2027. Trading will run on GalaxyOne Institutional, Galaxy's platform for banks and asset managers, while custody will be provided by Galaxy's institutional custody infrastructure, previously known as GK8. Customers will reach the market through a dedicated digital-asset section of the Leumi Trade capital-markets app, and users of PEPPER, the lender's mobile-only banking service, are also expected to be included. The announcement marks Leumi's second attempt to enter the market. In March 2022 the bank planned to offer Bitcoin and Ethereum through its Pepper Invest platform alongside U.S. infrastructure provider Paxos, with trades starting from as little as 50 shekels, roughly $15, but that initiative was halted before launch. The revived program replaces Paxos with Galaxy and adds Solana to the lineup. Maya Lavia, Leumi's head of strategy, described digital assets as an increasingly indispensable part of the global financial system. Galaxy Israel CEO Lior Ramesh argued that banks moving early onto open, programmable rails will shape the next era of finance, adding that Galaxy is building integrated trading-and-custody infrastructure for banks in multiple countries. The deal extends a busy stretch for Galaxy, which announced a separate digital-asset infrastructure collaboration with BNY on August 4, and it lands as policymakers elsewhere debate how lenders should treat crypto customers; in the U.K., parliament is examining restrictions some banks place on crypto-related transfers and accounts.

World Liberty Financial, the DeFi platform founded in late 2024 with ties to the Trump and Witkoff families, cleared its first major banking hurdle on August 14 when the Office of the Comptroller of the Currency granted preliminary conditional approval for a national trust bank dedicated to its USD1 stablecoin. The proposed World Liberty Trust Company, National Association, would be based in Bay Harbor Islands, Florida, and would bring USD1's issuance, redemption, reserve management and digital-asset custody in-house under one federally supervised roof. The charter is not a conventional bank license: the trust would not take retail deposits or make commercial loans. Instead, its approved activities center on USD1, whose market capitalization reached roughly $4.036 billion by mid-August, ranking it among the larger dollar-pegged assets. Unlike algorithmic stablecoins that defend a peg through code-driven incentives, USD1 is backed by cash and short-dated U.S. Treasury reserves. The OCC attached strict conditions: at least $20 million in Tier 1 capital, with $10 million or half the total — whichever is higher — held in qualified liquid assets, plus liquidity covering 180 days of operating expenses, anti-money-laundering controls, insurance coverage and an independent internal-audit function. The company has 12 months to raise the capital and 18 months to open the bank, or the approval lapses, and the trust must also apply to join a Federal Reserve Bank. A Trump-linked entity holds a 38% stake in World Liberty, and CEO Zach Witkoff is slated to serve as the trust's president and chairman. Witkoff called the decision a milestone that unifies USD1's issuance, custody and reserve management under OCC oversight. The application drew political scrutiny — Senator Elizabeth Warren called it self-dealing — while the OCC said certain investors signed passive agreements barring control over operations and that career staff reviewed the filing. BitGo Bank & Trust currently manages USD1's issuance and custody under an exclusive arrangement, and World Liberty plans to acquire the stablecoin's reserves and related liabilities from BitGo once final authorization is granted.

COINOTAG's analysis: These moves are opposite ends of the same institutionalization arc. Legacy lenders are embedding spot crypto inside regulated banking apps, while crypto-native issuers seek charters of their own. The primary documents are explicit: the OCC's August 14 conditional decision letter confines World Liberty Trust to fiduciary activities around USD1 and sets a $20 million capital floor, while Galaxy's official announcement frames Leumi as the first Israeli bank to integrate institutional trading and custody natively. If both tracks mature, chartered institutions will increasingly sit between users and decentralized infrastructure — from lending markets like Aave to the exchange plumbing of 0x Protocol.