Bank Leumi Hands Galaxy the Rails for Israeli Crypto Trading

Bank Leumi will let its customers buy, hold and sell Bitcoin, Ethereum and Solana through a partnership with Galaxy Digital, becoming the first Israeli bank to offer digital asset trading once the service reaches the Leumi Trade app in early 2027.

The move forms part of a wider regulatory thaw that is finally giving Israeli banks cover to stop treating crypto as pure risk and start treating it as a product they must keep in-house. Supervisors have shifted from containment to rules that let a full-service bank put trading and custody inside its own app rather than push clients toward outside platforms.

What Customers Will Get Inside Leumi Trade

Customers of Bank Leumi and its fully digital arm Pepper will access the service in a dedicated, secured section of the Leumi Trade capital markets application. Trading infrastructure comes from GalaxyOne Institutional. Custody sits on Galaxy’s Custody Infrastructure platform, formerly known as GK8.

• Buy, hold and sell selected digital assets starting with Bitcoin, Ether and Solana
• Access limited to Leumi and Pepper clients through the existing banking app
• Expected availability in early 2027, still subject to Bank of Israel regulatory approval
• Institutional-grade execution and security controls layered on top of open rails

The dedicated section matters because it keeps digital-asset activity inside the same login, compliance stack and support path clients already use for equities and funds. Execution and key management stay with Galaxy. The bank retains the client interface, the relationship data and the final say on who can enter the flow.

Maya Ravia, Head of Strategy at Bank Leumi, framed the choice in straightforward terms in the official partnership announcement on August 14: “We believe that digital assets are gradually becoming an integral part of the global financial system, and it is our role to enable customers to benefit from this development within a reliable, secure, and regulated banking framework.”

Leumi positions itself as Israel’s leading financial institution serving millions of customers across households, small businesses and large corporations, with 184 branches as of December 2025 and no controlling shareholder. The bank reported roughly NIS 786 billion ($216 billion) in total consolidated assets at the end of 2024 and a 29 percent market share by assets.

That scale is the distribution edge. A product that opens only to existing Leumi and Pepper clients starts with a verified base large enough to matter on day one, without a separate onboarding campaign.

Why Israeli Banks Can Finally Open the Gates

For years Israeli banks treated crypto-derived funds with heavy caution. Automatic delays on larger deposits and narrow lists of tolerated coins were common. That posture is shifting in 2026.

The Capital Market Authority has issued a rapid series of drafts covering security standards for wallets, capital requirements for providers, and clear screening rules that would let licensed firms offer the world’s top 50 digital assets once they clear market-cap, diversification and jurisdiction tests. The Bank of Israel has updated guidance under Proper Conduct of Banking Business Directive 411 so banks can no longer refuse crypto-linked payment services solely because the source is virtual currency. A legislative memorandum on shekel- and dollar-pegged stablecoins is also moving.

Key markers of the thaw:

• July 2026: Banking Supervision removed the automatic delay on crypto-origin deposits above NIS 100,000
• Summer 2026: Capital Market Authority circulars on custody separation, capital buffers and top-50 asset screening
• Ongoing: Bank of Israel digital shekel design work continues, with prioritisation and roadmap focus for 2026

Industry voices describe the change as moving from containment to principles-based rules that mirror New York and European MiCA approaches. The result is that a bank the size of Leumi now has political and supervisory cover to launch rather than block.

Directive 411 is the practical unlock for payments and deposits. The Capital Market Authority drafts supply the wallet, capital and screening standards that a bank can point to when it designs controls. Together they turn an earlier grey zone into a checklist a compliance team can clear.

Galaxy Supplies the Engine and the Solana Signal

Leumi is not building the crypto stack from scratch. It is plugging into the GalaxyOne Institutional trading and custody platform, which packages sales and trading, custody, staking, financing and research for banks and asset managers. Galaxy Custody Infrastructure underpins the operational side.

Lior Lamesh, CEO of Galaxy Israel, said: “The future of finance will run on open, programmable rails, and we believe the banks that move first will define the era that follows. Leumi is the first bank in Israel to bring digital assets to its customers, and it chose Galaxy to make it possible.”

Galaxy reported $8B assets on platform as of June 30 2026 and more than 1,700 institutional trading counterparties. The firm has also expanded staking services with partners such as BNY and secured a high-profile athletics naming deal, the Galaxy Digital Texas Tech naming rights deal, showing how far its brand has moved beyond pure trading.

The inclusion of Solana alongside Bitcoin and Ethereum is deliberate. Galaxy has already built institutional staking and exposure products around the network. Choosing SOL as the third asset tells clients and competitors that the menu will not stay frozen at the two largest coins.

Staking depth on that network also hints at how the product set can grow after the first three assets are live, without Leumi having to build validator or reward infrastructure itself.

Who Keeps the Customer and Who Feels the Squeeze

Once a client can buy Bitcoin inside the same app that holds their shekel salary and mortgage, the incentive to open a separate exchange account drops. Leumi keeps the relationship, the deposits and the data. Galaxy scales its bank-facing platform without having to acquire retail customers one by one.

That pattern is already visible elsewhere. The French banking giant BPCE Bitcoin and Solana launch followed a similar white-label logic. In the United States the E*TRADE crypto trading rollout with Zerohash showed how a large broker can open the rails while a specialist holds the keys. Israeli pure-play exchanges and brokers now face a competitor that already has millions of verified, KYC’d banking relationships and the full weight of banking regulation behind it.

• Leumi: retains salary flows, deposits, tax and AML context, and the primary app relationship
• Galaxy: gains distribution through a major bank without retail customer acquisition costs
• Pure-play exchanges: keep wider coin lists and leverage, yet lose the convenience argument for core holdings
• Retail clients: gain a regulated path inside an existing bank login, with a narrower initial asset menu

On X, sharper observers noted the real contest was never banks versus crypto but who owns the customer. Leumi chose to keep them. In a country that has lived with capital controls, geopolitical risk and a tech-heavy economy, the ability to move value quickly inside a trusted bank account carries extra weight. Once spot crypto lives on the same rails, tokenized funds and real-world assets become the logical next products.

An Earlier Attempt That Never Fully Landed

This is not Leumi’s first public step toward crypto. The timeline shows how long the road has been.

1. March 2022: Pepper Invest announced a deal with Paxos to offer Bitcoin and Ethereum trading inside the Pepper app, starting from small minimums and handling tax withholding, subject to regulatory approvals. The bank presented it as a first for the Israeli system.
2. 2022-2025: Broader banking system remained cautious. Crypto-origin deposits faced friction and many banks limited activity to a short list of coins.
3. 2026 regulatory wave: Capital Market Authority and Bank of Israel drafts and updates create clearer pathways for both licensed crypto firms and banks.
4. August 14, 2026: Leumi and Galaxy announce the new partnership covering BTC, ETH and SOL with a 2027 target, explicitly billed as making Leumi the first bank in Israel to offer the service.

The 2022 Paxos plan either stalled on approvals or never scaled to the full Leumi customer base. The Galaxy deal arrives with better infrastructure maturity, clearer rules and a broader asset set.

Side by side, the newer deal is wider on assets, wider on channels and timed to a supervisory window the earlier plan never received.

Open Rails Meet a Closed Client Base

The operating model splits cleanly. Galaxy supplies open, programmable trading and custody rails built for institutions. Leumi supplies a closed perimeter of already verified households, businesses and corporations.

GalaxyOne Institutional packages sales and trading, custody, staking, financing and research so a bank does not have to assemble those pieces alone. Galaxy Custody Infrastructure, the former GK8 stack, holds the assets. Leumi Trade and Pepper present the buttons and statements inside the bank’s own security boundary.

That split is what makes early 2027 plausible. Leumi avoids a multi-year build of wallets, liquidity and staking ops. Galaxy avoids cold-starting a retail brand in Israel. Clients see one app. Regulators see a bank still accountable for the relationship and a specialist accountable for the keys.

The same package is what Lamesh describes for banks around the world. Israel becomes a reference launch rather than a custom one-off.

Spot Trading Clears the Path for What Follows

Spot Bitcoin, Ethereum and Solana inside Leumi Trade are the first products, not the full ambition implied by the partnership language. Ravia cast digital assets as a growing part of the global financial system that belongs inside a regulated bank framework. Lamesh cast open rails as the base layer for the era ahead.

Several threads already on the table point beyond simple buy-hold-sell:

• Galaxy’s staking work with partners such as BNY, and its existing Solana institutional products, give a ready path to yield-style features once spot is live
• The legislative memorandum on shekel- and dollar-pegged stablecoins would, if it advances, sit naturally beside crypto balances in the same app
• Bank of Israel digital shekel design work keeps a central-bank token on the 2026 roadmap, another rail a full-service bank would eventually need to touch
• Tokenized funds and real-world assets are the step the customer-ownership logic already flags once spot crypto shares the rails with salary and mortgage accounts

None of those products is promised for the early 2027 window. The partnership still has integration, testing and final Bank of Israel approval ahead. The sequence, though, is visible: win the spot relationship first, then layer products that only make sense when the bank already holds the client and the specialist already holds the infrastructure.

Other Banks Will Watch the Playbook Closely

If Leumi goes live on schedule, the competitive pressure on the rest of Israel’s banking sector becomes immediate. Clients who want regulated crypto exposure will simply stay where their salary already lands. That forces peer banks to either partner with the same class of infrastructure providers or risk slow leakage of younger and wealthier customers.

We are building one platform for trading and custody, with institutional-grade security at its core, and the onchain rails beneath it, through Galaxy Infrastructure and GalaxyOne Institutional, for banks around the world.

Lior Lamesh’s line is the roadmap. Galaxy is not selling a one-off Israeli product. It is selling a repeatable bank package. Every successful launch raises the reference price for the next deal in Europe, Asia or the Middle East.

For Israeli retail traders the near-term choice expands: stay with specialist apps that offer wider coin lists and leverage, or move core holdings into the bank environment that already knows their tax and AML profile. For Galaxy the prize is distribution at scale without the cost of retail customer acquisition. For Leumi the prize is relevance. Crypto demand was going to find a home either inside the bank or outside it. The partnership decides the location.

Early 2027 is still months of integration, testing and final approvals away. Yet the direction is set. Israel’s largest bank has decided that the cost of keeping crypto clients is lower than the cost of losing them, and it has hired the rails to make that decision operational.