Israel's Capital Market Authority approved BILS, a shekel-pegged stablecoin built on Solana by licensed brokerage Bits of Gold, making it the first regulated fiat-backed token in the Middle East.
Israel's Capital Market, Insurance and Savings Authority granted Bits of Gold — the country's longest-running licensed crypto brokerage — permission to issue BILS, a shekel-pegged stablecoin built on Solana. The approval, announced on Monday, makes Israel the first country in the Middle East to sanction a regulated fiat-backed digital token.
The decision followed a two-year pilot programme in which BILS was tested on Solana's mainnet with Fireblocks providing custody infrastructure and EY handling the reserve audit. Bits of Gold must hold 1:1 reserves in regulated Israeli accounts, a requirement that mirrors the backing standards the GENIUS Act imposes on dollar stablecoins in the United States, though the Israeli framework was developed independently.
What separates BILS from the growing roster of dollar-denominated tokens is its currency. USDT and USDC extend the dollar's reach into on-chain markets; BILS does the same for the shekel — a currency that, despite Israel's outsised role in fintech, has had almost no presence in decentralised finance. That gap has practical consequences. Israeli businesses moving money on-chain have been forced to convert to dollars first, absorbing foreign-exchange costs and settlement delays that partly defeat the purpose of using a blockchain. A regulated shekel token removes the conversion step entirely.
The choice of Solana is deliberate. Bits of Gold needed a chain with sub-second finality and fees low enough to make small-value transfers viable, and Solana — which has seen its institutional credibility grow rapidly since Goldman Sachs disclosed a $108 million position in Solana ETFs earlier this month — fit the brief. The stablecoin uses Solana's SPL token standard and will be accessible through Fireblocks' wallet infrastructure, which already serves more than 1,800 institutional clients.
The regulatory architecture deserves attention. Israel's Capital Market Authority has required Bits of Gold to implement real-time reserve attestations — not the quarterly snapshots that plagued earlier stablecoin frameworks — and to maintain redemption guarantees that allow any holder to convert BILS back to shekels on demand. Cross-border payments are explicitly supported, meaning BILS can serve as a settlement rail for international transactions denominated in Israeli currency.
Jeremy Allaire, the CEO of Circle, predicted last month that a yuan-pegged stablecoin would emerge within five years; Israel has arrived first with its own currency. The template it has built — sandbox pilot, institutional custody partner, Big Four audit, 1:1 reserve mandate — looks designed to be copied. The question is whether demand materialises. Shekel-denominated DeFi liquidity is effectively zero today, and building it from scratch requires more than regulatory approval. It requires exchanges to list BILS pairs, lending protocols to accept it as collateral, and payment processors to integrate it into checkout flows.
None of that exists yet. But the approval itself is the hard part — Israel's financial regulators are not known for speed — and the infrastructure partners are already in place. Fireblocks handles custody for firms including BNY Mellon and Revolut; EY audits reserve backing; Solana processes the transactions. The pieces are assembled. The remaining work is commercial.
The Treasury's recent guidance under the GENIUS Act made clear that stablecoin issuers are being treated as banks. Israel has taken a different but parallel approach: treating them as licensed financial service providers with bank-grade obligations. Two very different regulatory traditions — Washington's post-crisis prudential framework and Jerusalem's capital-market authority — have arrived at essentially the same conclusion about what stablecoins are and how they should be supervised.
BILS went live on Monday afternoon. Its first real test won't be the technology; it will be whether Israeli fintech companies, which have spent years building dollar-denominated rails, see enough reason to build shekel ones.
