South African Reserve Bank Governor Pushes Back on Including Bitcoin in Strategic Reserves

South African Reserve Bank Governor Pushes Back on Including Bitcoin in Strategic Reserves

The Governor of the South African Reserve Bank (SARB), Lesetja Kganyago, has expressed strong opposition to the idea of governments holding Bitcoin as part of their strategic reserves, similar to gold.

Speaking on Tuesday at the ongoing World Economic Forum (WEF) in Davos, Kganyago argued that Bitcoin lacks the historical and intrinsic value of gold, making it unsuitable as a reserve asset. He dismissed the notion, likening Bitcoin to commodities such as platinum or coal, which are also unsuitable for reserve purposes.

“There is a history to gold,” Kganyago said, as quoted by TechCentral. “But if we now say Bitcoin, then what about platinum or coal? Why don’t we hold strategic beef reserves, or mutton reserves, or apple reserves? Why Bitcoin?”

Kganyago’s remarks follow recent statements by former U.S. President Donald Trump, who endorsed Bitcoin as a strategic asset. Trump also outlined plans to create a U.S. Bitcoin reserve to bolster economic stability.

Strategic reserves are essential stockpiles maintained by governments to mitigate disruptions caused by crises such as natural disasters, wars, or economic downturns.

In response to Kganyago’s skepticism, Coinbase CEO Brian Armstrong countered by highlighting Bitcoin’s advantages. Speaking during the same WEF panel, Armstrong argued that Bitcoin is an even better store of value than gold.

“[Bitcoin] has proven to be scarce, highly portable, and divisible,” Armstrong said. “It has also been the best-performing asset of the past decade. For a store of value, it’s going to become increasingly important for governments to hold it. It may start as just 1% of their reserves, but over time, it could equal or surpass gold reserves.”

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