Swiss National Bank Rejects Bitcoin as Reserve Asset

Martin Schlegel, the chairman of the Swiss National Bank, has indicated that Bitcoin is unlikely to become a reserve asset in Switzerland in the near future. During a shareholders' meeting in Bern, Schlegel stated that "cryptocurrencies do not currently meet the requirements of foreign exchange reserves." This stance is not new; Schlegel had previously expressed similar views in March, citing concerns over stability, liquidity issues, and security risks associated with Bitcoin.

The Swiss Federal Chancellery has proposed a constitutional amendment that would obligate the National Bank to hold Bitcoin by the end of 2024. To initiate a referendum on this proposal, the initiators need to gather 100,000 signatures. The amendment seeks to modify the third paragraph of Article 99 of the constitution, which currently states that the Swiss National Bank must create sufficient currency reserves from its revenues, with part of these reserves held in gold. If successful, the amendment would add the phrase "and in Bitcoin" to the text.

The initiative is backed by the Swiss non-profit project 2B4CH, which has prepared and filed the necessary documents. The project is supported by prominent figures in the industry, including Jeev Zangana, the vice president of Tether, the issuer of the largest stablecoin USDT. Yves Bennaim, the founder and chairman of 2B4CH, commented that the proposal does not advocate for a complete shift to Bitcoin but suggests that holding a small percentage of the National Bank's reserves in Bitcoin could be beneficial given its increasing value and security.

Lusius Meisser, a board member of Bitcoin Suisse, argued that holding Bitcoin makes sense as the world transitions to a multipolar arrangement, especially with the weakening of the dollar and euro. Meisser also noted that holding Bitcoin could shield the central bank from political influences associated with foreign currencies, whose reserves are predominantly denominated in dollars and euros. Politicians may be tempted to print money to fund their agendas, but Bitcoin's scarcity nature prevents dilution.

Despite the Swiss National Bank's rejection of the proposal, Switzerland remains a significant hub for the crypto industry. The country has been at the forefront of crypto initiatives, with the city of Zug being the birthplace of Ethereum, the second-largest cryptocurrency by market capitalization. Recent developments include international chain Spar starting to accept Bitcoin payments in a Swiss city this month.

In summary, while the Swiss National Bank has rejected the proposal to include Bitcoin in its reserves, the discussion at the state level indicates the maturing of the crypto industry. The development of tokenization of real assets further underscores the increasing integration of digital technologies into the traditional financial system. Even cautious countries will eventually need to recognize the significance of these advancements.