Swiss National Bank (SNB) Pushes Back Against Bitcoin Reserve Proposal

President of Swiss National Bank (SNB), Martin Schlegel has dismissed a proposal for the central bank to hold bitcoin in its reserves, citing volatility, liquidity concerns, and security risks.

The Swiss National Bank (SNB) has no plans to factor bitcoin into its national reserves, according to President Martin Schlegel, who responded to a recent proposal from a citizens’ initiative.

Swiss Center Bank Pushes Back Against Bitcoin Reserve Proposal

Several members of the Swiss crypto community have banded together to launch the Bitcoin Initiative, aiming to collect 100,000 signatures and bring a proposal for national bitcoin reserves to a vote.

The initiative suggests amending Switzerland’s constitution to require the SNB to hold reserves in bitcoin and gold, though it does not specify an allocation amount.

However, Schlegel expressed skepticism toward the idea of BTC in the central bank's reserves.

Speaking at the Intereconomics Conference in Bad Honnef, Germany, Schlegel said that bitcoin’s high volatility makes it unsuitable as a long-term reserve asset.

“We prefer assets that are less volatile. We are investing for the long term, and we want to be sure that the assets we hold retain their value,” he added.

According to Swiss Info, Schlegel also emphasized the need for high liquidity in central bank reserves to ensure swift monetary policy actions, something cryptocurrencies cannot guarantee due to their market swings.

“We need to be able to react quickly to economic shocks and changes in inflation. But cryptocurrencies are known for their high volatility, which would hamper the central bank’s ability to intervene effectively,” he said.

Moreover, Schlegel highlighted security risks, stating that bitcoin, being software, remains vulnerable to bugs and weaknesses.

“This could have serious consequences for the central bank’s balance sheet and for the Swiss financial system as a whole,” he added.

Finally, Schlegel downplayed crypto’s role in global finance, noting that the total market capitalization of all cryptocurrencies, which is currently at $2.8 trillion, is still relatively small compared to other asset classes.