Swiss National Bank (SNB) Has Opposed Integrating Bitcoin into Its Currency Reserves

Chairman Martin Schlegel addressed the matter during the institution's annual shareholder assembly in Bern on April 25. His remarks come amid rising pressure

The Swiss National Bank (SNB) has no plans to integrate Bitcoin into its currency reserves, despite pressure from the cryptocurrency industry and a pending referendum on the matter.

The institution's chairman, Martin Schlegel, addressed the issue during the SNB's annual shareholder assembly in Bern on April 25. His remarks come as the Bitcoin Initiative group is collecting signatures for a proposal to amend the Swiss constitution.

The initiative aims to mandate the SNB to diversify its reserve assets by investing up to 20% in Bitcoin, in addition to existing gold holdings.

According to a report by Blockworks, Schlegel highlighted the importance of SNB being able to buy and sell reserve assets quickly and reliably. However, he noted that Bitcoin and other digital currencies are not easily recognized in these standards due to their price volatility and limited liquidity.

"The price movements of cryptocurrencies are very, very high. They are not stable enough to be used as a safe reserve asset," Schlegel was quoted as saying.

The SNB chairman also touched upon technical risks associated with digital assets. He pointed out that software-based cryptocurrencies are susceptible to bugs and security flaws, which could destabilize Switzerland's monetary reserves if Bitcoin were to be included.

Schlegel's comments align with his previous statements where he clarified that the SNB currently sees no role for cryptocurrencies in its foreign-exchange reserve management.

Last month, during an interview with Bloomberg Television, he stated that digital currencies fail to meet essential requirements like value preservation and durability, which are crucial for an asset to be considered a standard in which an institution like the SNB would invest.

Crypto Initiative Seeks to Diversify SNB

Despite the SNB's stance, cryptocurrency advocates are increasing efforts to force policy change. The Bitcoin Initiative group has launched a referendum initiative to amend Switzerland’s constitution.

The proposal, which is expected to be completed by the end of April, aims to mandate the SNB to diversify its reserve assets by adding Bitcoin.

The group's founder, Luzius Meisser, spoke directly to shareholders at the meeting, presenting Bitcoin as a “special asset” that could help Switzerland in a multipolar world order with reduced confidence in sovereign debt.

"Bitcoin will not have value in normal times. But in a multipolar world order with a complete decline in trust for traditional government securities, we will need a special asset class, and that asset class is bitcoin," Meisser stated.

According to Swiss legislation, within 18 months, the campaign shall ensure that its proposal garners 100,000 signatures, which will compel the government to hold a referendum on the measure.

If the proposal passes in the future, Switzerland can be among the first countries to diversify its reserves with bitcoin.

Earlier this year, the U.S. announced the creation of a Bitcoin reserve. The government said it plans to build a general digital asset stockpile.