On Friday, the Swiss National Bank (SNB) held its 117th ordinary general assembly. For the fourth consecutive year, Bitcoin made its way onto the day's agenda. Luzius Meisser, Swiss crypto pioneer and representative of the Bitcoin Initiative, once again presented the arguments for an investment in digital gold to the SNB.
Under the name "For a financially strong, sovereign and responsible Switzerland (Bitcoin Initiative)," a private committee launched a popular initiative in December to mandate the Swiss National Bank to invest in Bitcoin. Specifically, the proposal would amend the excerpt of the Federal Constitution that prescribes a currency reserve in gold. Additionally, the SNB would be required to hold part of its reserves in Bitcoin. The signature collection period runs until the end of June 2026. At this year's general assembly of the National Bank, co-initiator Luzius Meisser once again seized the opportunity to promote the proposal.
Subscribe to our newsletter
The best articles of the week, directly delivered into your mailbox.
Bitcoin as a hedge in times of crisis
The two-minute speech briefly outlined the arguments for investing in Bitcoin. On one hand, digital gold has defied adverse market phases in recent years and reached new all-time highs. This resilience and its function as a hedge against a potentially looming dollar crisis make Bitcoin attractive for institutions like the Swiss National Bank. Furthermore, the United States has already begun accumulating a national reserve. For Switzerland, it would likely be better to be a "first" rather than a "last" mover.
Luzius Meisser’s speech on a Bitcoin investment / Source: SNB Livestream
In his speech, Meisser refers to the economic concept of an "Arrow Security." This describes a financial instrument that only pays out under certain conditions and typically represents a bet on a single future event. For the Bitcoin expert, the cryptocurrency is a bet on eroding trust in government bonds and traditional currencies. The rising prices of gold and Bitcoin underscore this thesis, says Meisser. Conventional portfolio theory recommends a small allocation to such Arrow Securities to hedge the risks of certain future scenarios.
Familiar counterarguments from the SNB president
Martin Schlegel, Chairman of the Governing Board of the Swiss National Bank, rejected the arguments citing the usual objections. According to him, Bitcoin and other crypto assets exhibit "very, very high" price volatility. Moreover, the SNB chief expressed concerns about market liquidity. The central bank must be able to buy and sell foreign currencies at any time - especially during times of crisis.
The initiative committee refuted these points in a press release available to CVJ.CH. The alleged high volatility and lack of liquidity are pretexts, especially since Bitcoin’s liquidity, measured by trading volume, is comparable to that of German federal bonds. In the past 24 hours alone, Bitcoin recorded a volume of nearly 20 billion USD. Even large transactions should be possible without further issues. As for volatility, it is comparable to that of technology stocks, which account for almost 30% of the SNB’s portfolio.
More important than the volatility of a single asset, however, is the impact on the overall portfolio. Using a verifiable simulation, Meisser shows that adding 1% Bitcoin to the SNB’s holdings would have increased the annualized volatility only marginally over the past ten years - from 7.35% to 7.47%. However, the value gain would have nearly doubled - from just under 10% to 18%. Thus, both political and economic arguments favor an investment in Bitcoin, according to the initiative committee.
