Proposed Referendum In Switzerland To Include Bitcoin In Bank Reserves
Many crypto enthusiasts are hopeful that they will be able to collect the necessary signatures, but the organisers themselves are not enthusiastic about their chances of winning the referendum.
According to Yves Bennaim, creator of 2B4CH, he believed that “a majority of people will vote ‘no’ to something they don’t understand” but the objective is to start the discussion and assist them in learning and understanding.
Although it may be underestimating the Swiss people, if the referendum is successful, existing members of the central bank board will certainly consider the proposal soon.
Historic Referendum Related To Swiss Finance
In a far more radical referendum in 2018, the Swiss people were asked to vote on sovereign money, which would mean that banks would not print money out of thin air when lending, but would instead move deposits around.
That plan was defeated in the end because it was much too extreme in its attempt to fundamentally and abruptly change a very complicated economic structure.
While the Bitcoin suggestion is a relatively minor technical adjustment that will be implemented deep inside the financial system’s pipelines, it will make no ‘real’ impact on the majority of ordinary people or on the financial system itself, as some experts believed.
Bitcoin is neither a stock owned by a single individual nor by a board of directors, whose supply may be manipulated at will, nor is it subject to the regulatory authorities.
The Issues Surrounding Cryptocurrencies
When it comes to central banks, some may even be implementing this diversification strategy themselves because they are in the business of minimising risk. This effort will surely include assets such as gold, or maybe, cryptocurrencies.
That would raise the issue of how much, and what proportion, the central bank should put in to help.
This is because central bank regulations do not stipulate how much these alternative assets should be held in reserve, the most logical course would be to defer to the central bank’s discretion as long as there is some rather than none.
It would seem that there is no justification for opposing the idea in this instance since the central bank may fulfil the requirement by Bitcoin too. Symbolically, it would also be a support of various forms of innovation too as the world gradually moves beyond the traditional finance boundaries.
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