Swiss National Bank President Rejects Bitcoin as a Reserve Asset

The inclusion of Bitcoin (BTC) in the country’s reserve assets has raised grave worries, according to Martin Schlegel, head of the Swiss National Bank (SNB). In a recent SwissInfo report, Schlegel noted concerns over volatility, liquidity, and security as reasons why Bitcoin does not meet the bank’s standards for a sound reserve currency.

Schlegel asserts that cryptocurrencies like Bitcoin are unsuitable for long-term investment plans due to their high volatility. He also said that digital assets lack the liquidity required for reserve holdings and voiced concerns about potential flaws in blockchain networks. He issued a warning that software flaws or “weak points” could expose crypto-based assets to security lapses.

Bitcoin Initiative Faces Opposition

The idea of incorporating Bitcoin into Switzerland’s reserve assets first surfaced in December 2023. A proposal titled “For a financially strong, sovereign and responsible Switzerland (Bitcoin Initiative)” suggested that the SNB should allocate a portion of its earnings toward BTC and gold reserves. The initiative aimed to strengthen the country’s financial sovereignty and economic resilience.

Despite the proposal, Schlegel remains unconvinced. He emphasized that the overall market capitalization of digital assets, estimated at $3.08 trillion, remains relatively small in the global financial landscape. He also reassured that the Swiss franc remains strong compared to other currencies, stating that the SNB is “not afraid of competition from cryptocurrencies.”

While Switzerland has been a hub for blockchain innovation, the SNB’s stance reflects a cautious approach to crypto adoption at the national level.