Switzerland’s central bank has rejected calls for it to create a strategic Bitcoin (BTC) reserve and add the largest cryptocurrency to its balance sheet.
In rejecting the proposal, the Swiss National Bank cited concerns over cryptocurrency market liquidity and volatility.
“Cryptocurrencies are known for their high volatility, which is a risk for long term value preservation. In short, one can say that cryptocurrencies for the moment do not fulfill the high requirements for our currency reserves,” said Swiss National Bank President Martin Schlegel at the institution’s General Assembly meeting.
The Bitcoin Initiative, a crypto advocacy group, had lobbied for the central bank to add BTC to its treasury, arguing that it would complement its overall portfolio and yield substantial returns.
Without Bitcoin, the Swiss National Bank's investments have grown by about 10% since 2015. A 1% Bitcoin allocation would have nearly doubled that return, argued The Bitcoin Initiative.
However, the Swiss National Bank rejected the proposal, countering that Bitcoin remains too risky for the central bank and Switzerland’s currency.
European Central Bank (ECB) President Christine LaGarde has repeatedly criticized Bitcoin, saying it is “worth nothing.”
Across Europe, other central banks have also rejected the idea of building a Bitcoin Reserve.
In February, Poland's central bank ruled out keeping reserves in Bitcoin. And the Romanian central bank has warned banks not to issue loans to cryptocurrency companies.
The price of Bitcoin is currently trading at $95,250 U.S., having risen 2% this year.
