Swiss National Bank Faces Proposal to Add Bitcoin to Its Reserves

A proposal to mandate the Swiss National Bank (SNB) to hold bitcoin as part of its reserves has been set in motion, according to an initiative published by the Swiss federal chancellery on Tuesday.

The proposal seeks to amend the law, requiring the SNB to diversify its reserves by including gold and bitcoin. Backed by a group of 10 individuals, including prominent Swiss cryptocurrency advocates, the initiative has 18 months to collect 100,000 signatures to qualify for a public referendum.

While the SNB has expressed skepticism about cryptocurrencies like bitcoin and ether, Switzerland regularly holds referendums on legislative changes, enabling such initiatives to potentially become law.

“All we’re saying is that gold is in the constitution, and Bitcoin is the best-performing asset of the last decade,” said Yves Bennaïm, a Swiss scholar and founding member of the non-profit group 2B4CH, in an interview with DL News. “So why not diversify?”

Despite securing a significant milestone with the Swiss Federal Chancellery’s approval, the process is far from over. The group must gather 100,000 signatures in favor of the amendment and submit it to the Swiss National Assembly. If approved, Swiss citizens will vote on whether to enact the law.

The Swiss National Bank has consistently raised concerns about cryptocurrencies. Chairman Martin Schlegal has highlighted issues like energy consumption and associations with illicit activities. In April 2024, former president Thomas Jordan pointed to bitcoin’s illiquidity and price volatility as reasons against holding it.

“Currency reserves are international means of payment, which need to be liquid, must retain their value and we must be easily able to buy and sell them,” Jordan stated during the SNB’s annual shareholder meeting.

Timing of the Proposal

The proposal’s timing may work in its favor. President-elect Donald Trump has advocated for building a bitcoin reserve as part of his election campaign. Similarly, Germany’s Free Democratic Party has indicated openness to central banks holding bitcoin. Analysts at Franklin Templeton expect several countries to establish bitcoin reserves this year.

Additional factors fueling the initiative include the launch of spot bitcoin exchange-traded funds in January 2024 and the adoption of crypto services by Switzerland’s state-owned PostFinance bank.

As of now, the SNB holds approximately $927 billion in assets, according to SNB data.