Trump Peace Committee Considers Introducing Stablecoin in Gaza Strip

Digital payments via a dollar-pegged cryptocurrency
"Intended to establish a new means of payment"

The Peace Committee led by the Donald Trump administration in the United States is reportedly exploring the introduction of a virtual currency known as a “stablecoin” to rebuild the economy of the Gaza Strip.

According to a report by the Financial Times (FT) on the 24th (local time), this initiative is part of efforts to restore the Gaza Strip’s financial and payment systems, which collapsed due to the war between Israel and Hamas. Stablecoins are cryptocurrencies whose value is pegged to legal tender such as the US dollar, allowing digital transactions while reducing price volatility.

The Trump administration has been consistently discussing this idea as a plan for the Gaza Strip, where the traditional banking system has been severely damaged. Since the 2023 war, banks and ATMs in the Gaza Strip have been destroyed and cash inflows restricted, causing a sharp decline in the physical circulation of the Israeli currency, the shekel. As a result, brokers have been supplying cash while charging high fees of between 20% and 50%, and the use of electronic payments has also been gradually increasing.

Regarding the introduction of a stablecoin, one official explained, “The aim is to provide residents of the Gaza Strip with a means to make payments digitally,” adding that “the stablecoin in question will be pegged to the US dollar.” The official also stressed that the intention is not to issue a “Gaza coin” or a new Palestinian currency, but rather to provide a tool that allows residents to continue commercial transactions digitally amid the ongoing cash shortage.

Some observers interpret the expansion of digital transactions as an attempt to dry up cash in the Gaza Strip and thereby curb Hamas’s ability to generate funds, since stablecoins, while allowing a degree of anonymity, can still be traced.

However, there are also challenges to implementation. Frequent power outages and limited telecommunications infrastructure in the Gaza Strip raise doubts about whether stablecoins can be used smoothly in practice. In addition, some point out that a Gaza-specific stablecoin could permanently separate the economies of the West Bank and the Gaza Strip, even though Palestine ultimately aims to establish an independent state. However, FT reported that specific operational details, including the regulatory framework and access model for the stablecoin, have not yet been determined.