Main Points:
- Martin Schlegel, SNB Chairman, rejects Bitcoin as a currency reserve asset due to liquidity and volatility concerns.
- Cryptocurrency advocates, led by Luzius Meisser, are campaigning to amend the Swiss constitution to mandate Bitcoin holdings alongside gold.
- SNB acknowledges the maturing crypto industry in Switzerland but remains unconvinced of Bitcoin’s practicality under normal financial conditions.
- Global context: central banks in other jurisdictions also debate crypto reserves, but most cite similar stability and regulatory hurdles.
- Future outlook: increasing tokenization of real-world assets and growing institutional crypto adoption may force central banks to revisit their stances.
1. SNB’s Firm Stance: Liquidity and Volatility Concerns
At the Swiss National Bank’s shareholder meeting on April 25, 2025, Chairman Martin Schlegel categorically dismissed proposals to include Bitcoin in the SNB’s foreign currency reserves. He emphasized two primary issues: the lack of reliable market liquidity and the “very, very high” price volatility intrinsic to cryptocurrencies, which undermine their ability to safeguard reserve value. In Schlegel’s words, “Cryptocurrency cannot currently fulfil the requirements for our currency reserves,” underscoring the SNB’s mandate to maintain assets that can be bought and sold at all times without jeopardizing financial stability.
Schlegel’s reservations are consistent with earlier statements in March, where he warned that Bitcoin’s rapid price swings and cybersecurity vulnerabilities made it unsuitable as a core reserve asset. Despite the allure of diversification, the SNB remains risk-averse, prioritizing asset stability over speculative potential.
2. The Bitcoin Initiative: Pushing for Constitutional Change
Opposing the SNB’s caution is the Bitcoin Initiative, spearheaded by activists such as Luzius Meisser of Bitcoin Suisse. At the same April 25 meeting, Meisser argued that in a shifting multipolar world—where trust in traditional government debt is eroding—Bitcoin offers a hedge against currency debasement and inflationary fiscal policies. He noted that as the U.S. dollar and the euro weaken, holding Bitcoin “makes more sense” and could serve as a bulwark when conventional assets falter.
In December 2024, supporters launched a campaign to gather the 100,000 signatures required to trigger a national referendum on amending Article 99 of the Swiss constitution. The proposed amendment would legally obligate the SNB to hold a portion of its reserves “in gold and in Bitcoin,” reflecting a novel approach to reserve management that blends traditional and digital store-of-value assets.
3. Switzerland as a Crypto Hub: Rise of “Crypto Valley”
Switzerland’s reputation as a leading center for cryptocurrency innovation lends weight to the Bitcoin Initiative’s arguments. The canton of Zug—colloquially known as “Crypto Valley”—hosts the global development of Ethereum and numerous blockchain startups, boasting a combined valuation in the hundreds of billions of dollars. Approximately 11% of Swiss residents reportedly hold some form of crypto asset, demonstrating widespread domestic adoption.
Despite this ecosystem, the SNB draws a line between supporting blockchain innovation and placing institutional backing behind a single digital currency. While Zug continues to incubate tokenization projects—from real estate to fine art—the SNB’s mandate remains focused on macroeconomic stability and adherence to International Monetary Fund (IMF) criteria for reserve composition.
4. International Comparisons: Central Banks and Crypto Reserves
Switzerland’s debate is part of a broader global conversation. In the United States, an executive order in March 2025 signaled exploratory support for a “strategic Bitcoin reserve,” though U.S. economists remain largely skeptical of its efficacy. A University of Chicago survey found no consensus among economists that a Bitcoin reserve would reduce portfolio risk. Similarly, the European Central Bank has publicly dismissed the notion, citing potential threats to monetary sovereignty and financial stability.
Conversely, smaller nations with surplus energy resources, like Belarus and Pakistan, have flirted with leveraging crypto mining and reserve diversification to monetize wasted power and hedge against currency devaluation. Yet, none have officially reallocated central bank reserves into cryptocurrency on a material scale, reflecting a widespread regulatory hesitation tied to price volatility, cybersecurity vulnerabilities, and unclear legal frameworks.
5. Evolving Criteria: From Volatility to Institutional Demand
Although central banks emphasize stability, evolving market infrastructure and regulatory clarity are gradually eroding some barriers to crypto reserve consideration:
- Improved Liquidity – Bitcoin’s average daily trading volume surpassed $60 billion in early 2025, up over 40% year-over-year, enhancing the feasibility of large-scale transactions without excessive market impact.
- Derivative Markets – The growth of regulated futures and options markets (notably CME and Eurex) provides tools for hedging crypto exposures, potentially mitigating volatility risks for institutional holders.
- Custody Solutions – Major banks and fintech firms now offer insured, third-party custody services that address historical security concerns, from multi-signature wallets to cold-storage vaults.
- Regulatory Advances – Switzerland’s Financial Market Supervisory Authority (FINMA) and the EU’s Markets in Crypto-Assets (MiCA) framework are setting clear guidelines for digital asset classification, governance, and reserve accounting.
As these trends mature, central banks—including the SNB—may find themselves reconsidering Bitcoin, especially if a small allocation (1–2%) could enhance portfolio returns without materially increasing risk. A 2025 analysis by the Bitcoin Initiative suggested that a hypothetical 1% allocation since 2015 would have nearly doubled the SNB’s portfolio returns with only a modest uptick in volatility.
6. Tokenization and the Future of Reserves
Beyond Bitcoin, tokenization of real-world assets is gaining traction in Switzerland. Projects ranging from tokenized bonds to real estate securitization on blockchain underscore the growing convergence between traditional finance and digital infrastructure. As tokenized assets become standardized and regulated, central banks could diversify reserves not only by currency but by asset type, including:
- Stablecoins backed by high-grade collateral, offering the familiarity of fiat-pegged value with blockchain interoperability.
- Tokenized government bonds, enabling fractional ownership and on-chain settlement that could streamline reserve management.
- Digital precious metals tokens, blending the stability of gold with the programmability of smart contracts.
This broader digital asset ecosystem may ultimately reshape reserve policy, making the current debate over Bitcoin one chapter in a larger narrative of central bank digital transformation.
Conclusion
The Swiss National Bank’s refusal to embrace Bitcoin as a reserve asset—anchored in concerns over liquidity, volatility, and security—reflects a cautious approach to integrating digital currencies within traditional monetary frameworks. While the Bitcoin Initiative’s constitutional campaign highlights the growing appetite for crypto diversification, the SNB’s primary mandate to safeguard financial stability remains paramount.
Nevertheless, Switzerland’s vibrant blockchain sector, coupled with global trends in derivative markets, custody solutions, and regulatory clarity, is steadily narrowing the gap between skepticism and institutional adoption. As tokenization of real-world assets accelerates, central banks worldwide—including the SNB—may be compelled to revisit their positions on digital reserves. Whether Bitcoin itself secures a slot in future reserve portfolios or serves as a catalyst for broader digital asset strategies, the debate underscores an inflection point in the evolution of global financial architecture.
