Bitcoin reserves interest gains momentum across 5 continents

Over the past twelve months, Bitcoin (BTC) has grown so widespread in acceptance that legislators and regulatory bodies on no less than five different continents are now contemplating its possible role as a reserve asset – a form of valuable, transferable wealth maintained by a central bank for transaction settlement purposes.

Recently, Czechia has been in the news as they are contemplating this matter. Governor of the Czech National Bank (CNB), Aleš Michl, stated on January 5th that the bank is exploring the possibility of Bitcoin as part of their plan to diversify their foreign exchange reserves.

As an analyst, I’m currently observing a bill making its way through the US Congress that proposes the establishment of a national Bitcoin reserve by the Treasury. If passed, this would involve acquiring one million Bitcoins over a five-year period, with annual purchases totaling 200,000 BTC. The mounting pressure is evident as governments in other countries, such as Switzerland and Poland, are considering similar moves.

CryptoMoon has created a global overview, highlighting countries where government interest is focused on Bitcoin reserves. This is the first instance in which such a map encompasses five continents and features nine distinct nations.

Bitcoin reserve in US, Brazil in the works

So far, El Salvador is the only country that has set up a reserve for Bitcoin. Under the guidance of President Nayib Bukele, this nation made headlines in 2021 by being the first to acknowledge Bitcoin as legal tender. Through his leadership, Bukele has accumulated approximately 6,022 Bitcoins, which at the time of publishing, are valued over $560 billion.

As a researcher, I’m intrigued by the prospect that the United States and Brazil could potentially follow El Salvador’s lead in adopting a Bitcoin reserve, making them the second and third nations to do so.

United States

During the 2024 U.S. federal elections, Bitcoin took center stage as politicians crafted cryptocurrency strategies aimed at attracting votes and securing support from the crypto community.

The incoming President, Donald Trump, has expressed optimistic views about cryptocurrency, suggesting that the United States should take a leading role in this sector. Furthermore, a proposed legislation in Congress aims to create a national Bitcoin reserve, reinforcing the administration’s potential involvement.

Senator Cynthia Lummis’ proposed Bitcoin Act of 2024 aims to set up a federal Bitcoin reserve for the U.S., with the Treasury purchasing approximately 1 million Bitcoins over a five-year period, or 200,000 Bitcoins per year.

As a crypto investor, I recognize that with the Republican Party controlling both chambers of the U.S. Congress, the Senate and House, the Crypto Bill might seem like it has majority support. However, the backing of my fellow legislators alone may not be enough to transform this bill into law. The road to enactment is long and filled with obstacles, so I remain cautiously optimistic about its progress.

Cryptocurrencies have backers across the political spectrum, but spending 200,000 Bitcoins at today’s prices amounts to more than $18 billion. This leaves many American voters uncertain about Bitcoin’s worth, with some viewing cryptocurrency as a temporary trend rather than a long-term investment.

Brazil

In a fashion similar to the United States, legislators in Brazil have proposed a bill to create a Bitcoin reserve. This bill, introduced on November 25th, suggests the establishment of a Strategic Sovereign Bitcoin Reserve (RESBit), which is intended to strengthen the rial and safeguard sovereign reserves from the impact of currency fluctuations and geopolitical risks.

Currently, several commissions and committees in Brazil are examining the legislature regarding this matter. If passed, they could authorize a 5% allocation of Bitcoin to be held within Brazil’s national reserves.

Under consideration in Russia, Czechia

In Czech Republic and Russia, high-ranking figures from their central banks and finance departments are contemplating the idea of holding Bitcoins as part of their reserves.

Russia

2024 saw Russian-based companies turning to cryptocurrencies as a method for cross-border transactions starting from July. This shift was prompted by legal reforms that made it possible to utilize cryptocurrency, thereby providing an alternative way to bypass any ongoing Western sanctions.

In simple terms, this workaround has gained considerable support from Russian authorities. At a conference held by the Russian Society of Knowledge on November 6, 2024, Finance Minister Anton Siluanov stated that although he advises against individual investors investing in cryptocurrencies, digital assets are crucial for international transactions given the current geopolitical context.

“International trade participants — importers and exporters — instead of calculating with [fiat] currency, use crypto wallets and use crypto for their settlements. And why not? In the current state of affairs, it’s justified.”

Last month, Deputy of the State Duma Anton Tkachev officially requested the establishment of a strategic Bitcoin reserve by the state, due to the significant role this function seems to play.

According to reports, Tkachev emphasized the increasing volatility of conventional currency reserves such as the Chinese yuan and U.S. dollar. He further stated that for countries subjected to sanctions, digital currencies like crypto are practically the only option for international trade. It is said that the central bank is planning an exploration into cross-border transactions using cryptocurrencies.

Czechia

In the Czech Republic, Aleš Michl, head of the Czech National Bank (CNB), mentioned during an interview that they are contemplating Bitcoin as a potential component in the diversification of their foreign exchange reserves.

As a researcher, I find myself pondering the idea of investing in a modest amount of Bitcoin. This purchase would constitute a minor fraction of our institution’s overall assets, necessitating the consensus of all seven of our board members for approval.

Janis Aliapulios, a consultant for the CNB’s board, subsequently shared with CryptoMoon that the bank currently lacks any definitive plans for acquisition; however, he emphasized that the possibility of an acquisition cannot be entirely dismissed by Michl.

“To sum up, CNB is now not considering buying crypto assets for its reserves. However, Governor Michl did not rule out further future debate on this topic.”

Pressure rising across the globe

Support for establishing a national Bitcoin standard is growing in various nations, as notable policy makers and legal advisors endorse this concept in Poland, Switzerland, Germany, South Africa, Hong Kong, Japan, and Venezuela.

Switzerland

Switzerland has consistently demonstrated a welcoming and progressive attitude towards cryptocurrencies since the early era of Bitcoin. Numerous significant crypto businesses and foundations have established their bases in this country.

In the near future, it appears that the nation may be moving crypto integration another level up. On December 5, 2024, proponents of cryptocurrency, such as Giw Zanganeh, vice president of energy and mining at Tether, and Yves Bennaïm, founder and chairman of Swiss Bitcoin nonprofit think tank 2B4CH, submitted a proposal suggesting that the Swiss National Bank (SNB) should be required to hold Bitcoin as part of its reserves.

By June 30, 2026, the petitioners need to gather approximately 1% of the Swiss population in signatures, which equates to around 100,000 people. Given that the total Swiss population is approximately 8.92 million, this is a relatively small number.

2B4CH had been considering submitting this proposal for some time, yet the lack of backing or excitement delayed the concept. However, as per Bennaïm’s latest statement to CryptoMoon, it seems the circumstances have shifted.

“Now, everything is falling into place, and this is why we submitted the documents and will start collecting the signatures.”

Should the petition gather sufficient signatures, the proposition for a “fiscally stable, independent, and prudent Switzerland” will advance to a public vote in a referendum.

South Africa

The uMkhonto weSizwe Party (MKP) has proposed the creation of a Bitcoin reserve within South Africa as well.

Last month, Nhlamulo Ndhlela, representative of the left-populist party, stated on X that the MKP advocates for South Africa to explore the concept of a Bitcoin reserve as an investment option, and encourages the implementation of Bitcoin mining projects as part of a broader plan to stimulate economic growth and diversification.

Instead of frequently advocating for a Bitcoin reserve by emphasizing terms like austerity, inflation, and “numbers increasing,” Ndhlela argued that Bitcoin could serve as an avenue for economic liberation since the current administration persistently borrows money from institutions such as the IMF and World Bank, burdening our country with debt.

Ndhlela indicated that the initiative would begin modestly, allocating between 1% and 2%, which could potentially capitalize on 3 gigawatts of stranded renewable energy generation. He also emphasized that this move would lessen dependence on the dollar and aid in formulating a regional financial strategy with BRICS allies.

MKP is currently an opposition party, with 58 seats in the 400-seat National Assembly.

The MK Party proposes that South Africa might find it beneficial to establish a Bitcoin strategic reserve as a financial asset, and also pursue Bitcoin mining projects as part of a wider plan to stimulate and expand the economy. Meanwhile, our current administration seems to be accumulating debt for the nation…

— Nhlamulo Swabihi Ndhlela Ntukulu Wa Ka Moyane (@NhlamuloNdhlela) December 20, 2024

Poland

If elected as Poland’s president in May 2025, the candidate Sławomir Mentzen plans to designate Bitcoin as a form of reserve currency.

At the close of last year, Mentzen, a member of the right-wing, nationalistic group known as the Confederation Liberty and Independence coalition, experienced a significant boost in popularity. His support grew from 2% of voters to more than 10%.

In this case, it can be rephrased as follows: He remains significantly less popular than Rafal Trzaskowski, the incumbent mayor of Warsaw who represents the centrist Civic Coalition, and is currently leading the race.

Germany

In an interview with Handelsblatt on December 30, former German Federal Minister of Finance and Free Democratic Party leader, Christian Lindner, suggested that, to keep pace with developments, the Bundesbank – Germany’s central bank – might want to explore the idea of maintaining a reserve in Bitcoin.

Perhaps it’s worth examining if central banks might not include cryptocurrencies as a part of their reserve assets.

As an analyst, I’d like to echo Linder’s sentiment. Cryptocurrencies, in my view, can fortify the robustness of our reserves because they signify a substantial contributor to the worldwide growth in wealth.

Japan

On December 11, 2024, Japanese legislator Satoshi Hamada (a name that may strike Bitcoin enthusiasts as ironic) suggested the government should examine the idea of establishing a Bitcoin reserve.

As a researcher, I am of the opinion that it’s crucial we delve into this subject further. I am eager to understand the government’s perspective on this issue.

Yet, it appears that not everyone shares Hamada’s enthusiasm for exploration. The local industry media have reported that Japan’s Prime Minister, Shigeru Ishiba, has turned down the proposal, citing a lack of comprehension among many nations regarding the drive in various countries to establish Bitcoin reserves.

For now, at least, the idea appears to be tabled.

Hong Kong

According to a local politician in Hong Kong, China’s “one country, two systems” policy might provide an opportunity for the city-state to incorporate Bitcoin reserves into its system.

Wu Jiexhuang, a member of Hong Kong’s Legislative Council, suggested that local regulators and lawmakers should examine the impact of Bitcoin exchange-traded funds in the United States and consider the possibility of establishing a Bitcoin reserve. He noted that such a reserve could potentially influence markets.

Wu further added that having Bitcoin as part of its own reserves would help Hong Kong navigate disruptions in traditional financial markets more effectively.

Venezuela

In the end, the struggling political opposition in Venezuela is considering a Bitcoin reserve as a potential solution for some of the numerous issues the nation faces.

In simpler terms, Maria Corina Machado, a key figure in Venezuela’s opposition, stated back in September that Bitcoin has transformed into an essential lifeline for Venezuelans. Originally serving as a humanitarian aid, it has now grown into a crucial method of resisting the current situation.

Machado suggested incorporating Bitcoin into Venezuela’s national economy on a governmental level, with the intention of adding it to the country’s reserve assets, aiming to bring stability to the economic system.

As a researcher, I’m observing an increasing fascination towards Bitcoin among influential figures, which seems to be propelling it further towards mainstream acceptance. However, there are some doubters who persist. Despite the enthusiastic adoption in certain regions, proponents of Bitcoin have a considerable task ahead to persuade their peers about the merits and value proposition of this digital currency.

2025-01-14 13:03