Swiss Bitcoin Advocates Renew Drive for Central Bank Bitcoin Reserves
Swiss Bitcoin advocates are once again attempting to persuade the Swiss National Bank (SNB) to include Bitcoin in its reserves, arguing that it would enhance the country’s sovereignty and neutrality. To do so, they need to gather 100,000 signatures through a referendum, marking their second attempt following an unsuccessful endeavor in October 2021.
Arguments for a Bitcoin Reserve
Proponents of a Bitcoin reserve for the Swiss National Bank highlight its unique characteristics:
* Limited Supply and Inflation Hedge: Unlike traditional currencies, Bitcoin has a finite supply of 21 million coins, protecting against inflation, a major concern for central banks.
* Decentralization and Security: Bitcoin operates on a decentralized network, not controlled by any single entity. This distributed ledger technology offers a high degree of security and transparency.
* Diversification and Performance: Bitcoin has shown significant growth over the past decade, offering potential diversification benefits for the SNB’s reserves.
Potential Risks of a Bitcoin Reserve
However, there are also some risks associated with holding Bitcoin reserves:
* Volatility: Bitcoin’s price is known for its dramatic fluctuations, which could introduce significant instability into the SNB’s reserves.
* Regulation and Uncertainty: The regulatory landscape surrounding Bitcoin is still evolving, and its long-term viability as an asset class remains uncertain.
* Security Concerns: While the Bitcoin network itself is secure, there have been instances of hacking and theft on cryptocurrency exchanges where Bitcoin is held.
SNB’s Current Stance
The SNB has yet to indicate a change in its stance on Bitcoin. Central banks are known for their cautious approach, and the SNB may require further developments in the Bitcoin ecosystem, such as more robust regulations and improved security measures, before considering it a viable reserve asset.
Divya 
Mehek