Bank Leumi is stepping into crypto. On August 14, the Israeli lender announced a partnership with Galaxy Digital to offer Bitcoin, Ethereum, and Solana trading to roughly 2.5 million retail customers. The service, slated for early 2027, would make Leumi the first bank in Israel to let customers buy and sell digital assets directly — provided the Bank of Israel gives the green light.
Inside the new service
Leumi's customers, including those on its mobile arm PEPPER, will trade inside a dedicated, secured section of Leumi Trade, the bank's capital markets app. GalaxyOne Institutional supplies the trading platform, while custody runs on Galaxy's infrastructure, formerly known as GK8. That means the bank isn't building its own rails — it's renting them from a firm that's been in the crypto custody game for years.
A regulatory thaw
The timing isn't accidental. In mid-July, the Bank of Israel's Banking Supervision Department removed the automatic delay on deposits tied to crypto transactions above NIS 100,000. That was a quiet but meaningful shift. Leumi had tried this before: a 2022 partnership with Paxos to offer BTC and ETH never reached customers because the central bank wouldn't approve it. Now the regulator seems more open, even as the Capital Market Authority floats draft rules that would let licensed companies trade the 50 biggest digital assets — subject to a $500 million market cap floor, holder-concentration limits, and registration in recognized jurisdictions like the EU and New York State.
Galaxy's Israeli roots
Galaxy's path into Israel is a story of bankruptcy and resurrection. The custody tech it's using came from GK8, a Tel Aviv startup that Celsius bought for $115 million in 2021. When Celsius collapsed, Galaxy picked up the platform in insolvency proceedings, along with about 40 staff and a Tel Aviv office. GK8 co-founder Lior Lamesh now runs Galaxy Israel. He's blunt about the strategy: 'The future of finance will run on open, programmable rails, and we believe the banks that move first will define the era that follows.'
The service still needs approval from the Bank of Israel. Leumi hasn't said when it expects a decision, but the early-2027 target suggests the bank is confident. If it lands, it'll be a test case for how traditional banking and crypto coexist in a country that Chainalysis says pulled in roughly $22 billion in on-chain value over the year to June 2025. The central bank's next move will tell you whether that money stays on the sidelines or flows through a bank account.
