The Swiss National Bank has refused to keep Bitcoin reserves with reference to concern about the cryptocurrency of the market’s liquidity and volatility.
“For Cryptocurrencies, the market’s liquidity is, although at times it may seem ok at times, especially during crises that are naturally in doubt,” said SNB President Martin Schlegel at the bank’s general meeting meeting on Friday.
“Cryptocurrencies are also known for their high volatility, which is a risk of conservation of prolonged value. In short, one can say that cryptocurrencies do not currently meet the high demands of our currency reserves.”
Schlegel’s comments were asked for the Bitcoin initiative, a Bitcoin Advocacy Group, whose research shows that the addition of Bitcoin to Switzerland’s treasury would supplement its overall portfolio and yield a significant return with minimal volatility.
Without Bitcoin, the Swiss national bank’s investments grew by approx. 10% since 2015. A 1% bitcoin allocation to the central bank’s portfolio would have almost doubled the return in the same period, according to a Bitcoin Initiative Portfolio Simulation. Annual volatility would have only risen slightly.
The Bitcoin initiative emphasized that Bitcoin’s volatility should not be evaluated in isolation, but with regard to its influence on the overall dynamics and the benefit of the investment portfolio.
“[Bitcoin] The award reached new heights, the shown resilience during Market Stress, and it remains very fluid with trade volumes in double billions, every day and night, even on the banking holiday, ”said Luzius Meisser, a member of the Bitcoin initiative and board member of Bitcoin Suisse.
“The Bitcoin network is still one of the most reliable and secure IT systems ever created. And most remarkably, the US has started a strategic Bitcoin storage.”
In an E -Mail statement to Coindesk, the Bitcoin initiative suggested that the Swiss National Bank’s reluctance to Bitcoin could be political as it could be perceived as “an expression of distrust of other currencies” and damage delicate relations between Switzerland and the European Union.
The President of the European Central Bank Christine Lagarde has consistently criticized Bitcoin, calling it “Nothing Nothing” and a “very speculative asset” associated with money laundering. In January, Lagarde “I am convinced” said “Bitcoins will not enter the reserves for any of the central banks of the General Council” for the ECB.
It was in response to comments from the Czech national bank governor Ales Michl that his institution assessed to add Bitcoin to its reserves. Lagarde claimed that Bitcoin does not meet ECB’s criteria for liquidity, security and security from criminal associations.
In February, in any case, Poland’s central bank excluded “keeping reserves in Bitcoins” and the Romanian central bank warned the banks not to issue loans to cryptic companies.
Federal Reserve President Jerome Powell said in December 2024 that the US central bank “was not allowed to own Bitcoin” under the Federal Reserve Act and that it does not appear to change the law.
The Swiss National Bank has indirect Bitcoin exposure through shares that own Bitcoin Treasuries, including 520,000 shares in the strategy, 8.12 million shares in Tesla, 580,000 shares in Mara Holdings and 500,000 shares in Cleanspark, from the end of 2024 according to FineLel data.
Schlegel rejected citizen calls to add Bitcoin reserves to the Swiss central bank’s boxes as late as last month. When it comes to technological advances, Schlegel noted on Thursday that SNB is running a pilot project using Central Bank Digital Currencies to facilitate payments between financial institutions.
In contrast, US President Donald Trump signed an executive order this year creating a strategic Bitcoin Reserve and Crypto Stockpile along with a cryptor council that will evaluate budget neutral ways to supplement US digital reserves. The order prohibits additional state agencies from creating or promoting a central bank’s digital currency in the United States out of privacy of citizens.
