TL;DR
- US considers a dollar-pegged stablecoin to rebuild Gaza’s payment system.
- Cash shortages after the war pushed residents toward digital payment alternatives.
- Tancman leads the Peace Board effort; no final rules set yet.
The Trump administration is considering the creation of a dollar-pegged stablecoin to help rebuild the economic system in Gaza. According to five sources familiar with the discussions, US officials and members of the recently formed Peace Board view a cryptocurrency-based payment tool as a way to restore transaction capacity in a region where traditional banking has collapsed.
The proposal remains in early stages, and many implementation details have not been settled. But the conversations point to a specific intent: giving residents a method to conduct digital payments without relying on a new Palestinian currency or what one source described as a “Gaza Coin.” Instead, the model would use a stablecoin — a type of cryptocurrency whose value is tied to a traditional currency like the US dollar — as a transaction tool.
The project falls under the Peace Board, a US-established body tasked with Gaza reconstruction. Israeli tech entrepreneur Liran Tancman is serving as a volunteer advisor on the board and leading the digital infrastructure effort.
At a Washington board meeting last week, Tancman said the goal includes building a “secure digital backbone” for Gaza that would support e-payments, financial services, distance learning, and healthcare.
Two other groups are involved: the National Committee for the Governing of Gaza, a new Palestinian technocratic administration, and the High Representative’s Office led by former UN representative Nickolay Mladenov. Both operate within the Peace Board structure.
The regulatory framework and access rules for the stablecoin would be set by the Peace Board and the NCAG, sources said, though no final model exists yet. The White House and State Department did not respond to requests for comment.
Cash Shortages Drive Search for Alternatives
The push for a digital payment tool follows acute cash problems in Gaza after the war that began in 2023. The region relies on the Israeli shekel as its official currency. The Palestinian Monetary Authority, which serves as the central bank in Gaza and the West Bank, lacks the power to issue its own currency. Dollar transactions occur but at lower volume than shekel payments.
Access to physical shekels became severely restricted during the war. Many ATMs were destroyed or closed. Israel blocked new cash shipments into the region. The shrinking money supply led cash distributors to charge high commissions. Residents shifted toward electronic payment systems where available.
The Trump administration has previously supported broader use of dollar-pegged stablecoins
The current Gaza discussion represents a specific application of that preference in a territory with damaged financial infrastructure.
Some sources caution that introducing a Gaza-specific stablecoin could weaken economic links with the West Bank. The two areas currently share a payment system based on the shekel. Palestinian statehood plans assume economic integration between Gaza and the West Bank. A separate digital payment system could make Gaza a more closed economy, according to those raising concerns.
The immediate problem is more concrete: residents need a way to pay for goods and services. Cash is hard to get. Banks do not fully function. The administration’s answer, still in draft form, is a digital dollar token that moves through phones rather than wallets. Whether that solves the problem or creates new ones will depend on details yet to be written.
