Recently, the president of the Swiss National Bank (SNB), Martin Schlegel, rejected the idea of holding Bitcoin in the reserves of the bank, as a public initiative suggests. He said cryptocurrencies have several problems as a asset class, in an interview with the Tamedia newspaper group.
Why cryptocurrencies do not correspond to SNB
The president of the Swiss National Bank (SNB), Martin Schlegel, explained why cryptocurrencies do not fill the essential characteristics that a good currency should have in an interview with a media group.
He highlighted three main reasons: first, cryptocurrencies are very volatile, which makes them unreliable to maintain a long-term value. Second, he noted that BNB reserves must be very liquid, which allows rapid use in monetary policy if necessary. Finally, Schlegel stressed that cryptocurrencies have security defects because they are based on software, which can have bugs and vulnerabilities.
SNB competition with crypto?
In addition, Schlegel maintains that the role of SNB is not to offer cryptocurrencies, noting that the total market value of all cryptocurrencies, around 2,000 billion CHF, is still small compared to the global financial system. He described cryptocurrencies as a “niche phenomenon”.
Asked about crypto competition, Schlegel said that the currencies have always been competed. However, he stressed that the Swiss franc is in great demand and that the SNB is not really worried about competition from cryptocurrencies.
The Bitcoin initiative
However, a proposal launched last December aims to investigate the Swiss National Bank (SNB) in Bitcoin. The group behind “the Bitcoin initiative” has 18 months to collect 100,000 signatures to bring it to a public vote. The plan suggests that SNB should build its currency reserves with income, including gold and bitcoin, although it does not say how many bitcoin should be held. The initiative is supported by Yves Bennaïm, an internet pioneer and other defenders of Swiss cryptography, the main objective of which is to trigger a public debate.
