• Swiss National Bank rejects Bitcoin as a reserve currency due to volatility.
  • Schlegel cites Bitcoin’s security risks as it is just software.
  • A proposal to add Bitcoin to reserves needs 100,000 signatures for a referendum.

The head of Switzerland’s central bank, Martin Schlegel, has shut down Bitcoin as a reserve currency. Since it is illiquid and extremely volatile. During an interview Saturday in Tamedia media group newspapers, Schlegel quoted that cryptocurrencies do not meet the most pressing requirements a healthy currency must fulfill.

Swiss National Bank Rejects Bitcoin

Schlegel, became the new president of the Swiss National Bank (SNB) in October 2024. Who added that Bitcoin and other cryptocurrencies are “extremely volatile,” making them complicated to be part of a nation’s currency reserves. Currency reserves must be very liquid so they can be spent quickly, something that, up to now, is not possible with cryptocurrencies, he believes.

The SNB, which has been actively purchasing currency markets in a bid to hold back the appreciation of the Swiss franc. Who believes that cryptocurrencies are still a “niche phenomenon,” employed primarily for speculation. Schlegel also referred to security concerns pertaining to digital currencies. Citing the fact that they are, essentially, “just software,” and thus susceptible to any attack.

Even in the face of all these obstacles, there has been a new popular initiative presented in December 2024 in the Swiss direct democracy.

Proposal to Add Bitcoin to Reserves

The initiative will force the Swiss National Bank to include Bitcoin in its monetary reserve. The proposal, if implemented, would acknowledge Bitcoin as the most established cryptocurrency within the reserves of the nation. The initiative organizer. However, have until June 2026’s end to collect 100,000 signatures to enable a referendum.

At the same time, Bitcoin has wildly fluctuated in price. Friday dropped below $80,000 for the first time since last November of 2024. Down over 25% from its high of almost $110,000, reached only hours before President Donald Trump was inaugurated on January 20. This drop serves again to demonstrate the problems that the volatility of Bitcoin causes in the handling of world currencies.

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