Israel's largest bank Bank Leumi partners with Galaxy to offer crypto services

Bank Leumi, Israel’s largest bank, has announced plans to allow its retail customers to buy and sell Bitcoin, Ethereum, and Solana inside its Leumi Trade app, using Galaxy Digital’s trading and on-chain storage infrastructure.

The service is set to launch in early 2027 and still requires the approval of the Bank of Israel.

Bank Leumi refines Leumi Trade app

The two companies announced the partnership on Thursday, under which users of Leumi and PEPPER (Bank Leumi’s mobile-only banking arm) accounts will get access to a secure and exclusive part of the Leumi Trade capital markets app. In this new area of the app, a short list of tokens can be bought, sold, and even held long-term, according to a Galaxy press release.

Bitcoin (BTC), Ether (ETH), and Solana (SOL) are the assets initially named for the service, with other “selected” coins to follow.

Galaxy Digital (Nasdaq: GLXY), the firm overseen by Mike Novogratz, is supplying the infrastructure for the service. The bank will trade through GalaxyOne Institutional, Galaxy’s platform aimed at banks and asset managers.

Bank Leumi has also separately signed on to Galaxy’s custody arm, formerly the Israeli security company GK8, to hold the private keys and safeguard customer assets. Galaxy claims the partnership makes Leumi the first bank in the country to expose its customers to digital assets.

Another trial after 2022 Paxos deal collapse

This new development with a dabble into digital assets is not new territory for Leumi. Its investment unit, Pepper Invest, announced back in March 2022 that it would open BTC and ETH trading through Paxos, claiming to be the first of its kind in Israel at the time.

The service, however, never went live. The plan is reported to have stalled because the regulatory approval it depended on never arrived from the Bank of Israel.

This means the 2027 target for the recent iteration still carries an asterisk, as the same regulator that inhibited the Paxos effort has not given a go-ahead for the new partnership’s service. Leumi believes, though, that this new run will clear a hurdle the initial plan could not, with the current environment for crypto regulation being better than it was in 2022.

Bank of Israel no longer a roadblock

Israel’s rules on bank exposure to crypto were, until recently, hostile by design. Banks could hold up crypto-linked deposits automatically and turn away fiat that traced back to crypto sources, while licensed trading firms were only allowed to work with a narrow list of coins.

This structure has relaxed over the past year. The Bank of Israel has scrapped the automatic deposit delays and blocked banks from issuing blanket refusals of money coming from licensed providers. The Capital Market Authority has also set security and capital floors, 2 million shekels for firms without custody and 2.5 million shekels for those holding customer assets, plus a requirement to keep client funds segregated.

A circular released on August 1 then increased the amounts of coins allowed for trading to the 50 largest coins by market value, provided each sits above a $500 million cap. A combination of these moves altogether gives banks like Leumi a regulated platform that did not exist three years ago.

Israeli crypto market continues to grow

Israel saw an estimated $22 billion in on-chain crypto value from June 2024 to June 2025, according to Chainalysis figures. Across the wider Middle East and North Africa, on-chain activity increased by 33% annually to more than $500 billion, though the region grew more slowly than Asia-Pacific and Latin America.

Leumi, founded more than 120 years ago and operating without a controlling shareholder, is platforming the move as part of its innovation push. The initiative gives customers “simple, secure, and regulated access to trading digital assets,” Maya Ravia, the bank’s Head of Strategy, said in the announcement.

Lior Lamesh, CEO of Galaxy Israel, said the firm is “building one platform for trading and custody” for banks.

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