Switzerland is a friendly country that treats cryptocurrencies. They will hold a referendum on June 10 to discuss whether to introduce a sovereign currency system, which may fundamentally change the country’s currency concept. Due to the rise of Bitcoin, Swiss may now need to rethink what money is.
Since 2009, Bitcoin’s penetration rate and use rate have been increasing, even providing a safe haven for safe havens for developing countries such as Argentina and Venezuela. The birth of Bitcoin seems to be to transform the entire financial system. “Nakamoto Satoshi” hopes to seize monetary power from bankers and return them to people – although there is still a certain distance from this goal, it is undoubtedly made larger. As it progressed, some cross-border remittance companies also started to use Bitcoin to provide transfer services.
Switzerland to reconsider sovereign currency system
It is said that the recent Swiss referendum is likely to be related to bitcoin, and they hope to use voting methods to decide whether Switzerland should turn to the sovereign currency system, which will make it more difficult for banks to expand credit and money supply, and the SNB - The Swiss National Bank (SNB) will be the only source of money, and banks can only “borrow money” from central bank savings.
If the Swiss referendum chooses a sovereign currency system, it will obviously have a greater connection with Bitcoin. For example, assuming that the SNB announces that bitcoin is part of its foreign exchange reserves, it will inevitably have a big impact on the price trend of bitcoin. But no matter which result, the voting shows that the Swiss are scrutinizing the current financial system. If they can really walk down the road, then the focus will undoubtedly be: Bitcoin.
Switzerland has always been a “hotbed” for Bitcoin and other cryptocurrencies, and it is also one of the most lenient regulatory environments in the world. For example, Swiss Railways has integrated dozens of bitcoin ATMs into station ticket machines; in July last year, a Swiss bank launched a cryptocurrency service that allowed customers to store bitcoins and purchase cryptocurrencies.
Industry analysts ponder over the Swiss referendum
According to a Reuters report, according to previous poll results, one-third of Swiss citizens plan to vote “in favor” to abolish the bank’s right to create money, but 10% have yet to decide which vote to take. Earlier, the Swiss Central Bank President Thomas Jordan once described the sovereign currency system as a "dangerous cocktail."
If the referendum passes, cryptocurrency advocates believe that a more stable and sound financial system will emerge and that the frequency of financial crises will also be reduced. At the same time, some critics pointed out that the sovereign currency system will hinder the ability of the Swiss National Bank to intervene in the foreign exchange market, which in turn will trigger large swings in the Swiss franc, giving profit to financial institutions such as UBS and Credit Suisse. Adverse effects.
Neil Weller, a foreign exchange strategist at JPMorgan Asset Management, believes that banking systems such as the sovereign currency system have not been seen for a long time. The referendum’s passing through may give Switzerland’s domestic assets a lot of uncertainty, including stocks and bonds. .
Paul Wetterwald, chief economist at Indosuez Wealth Management, also stated that currency intensity reflects the strength of the economy and the trust shown by the market (and its people). Ironically, if the sovereign currency system is accepted, the SNB’s “safe haven” status in the global financial system may be affected because the SNB may weaken some of the Swiss francs.
Of course, before the referendum, the outside world had all kinds of speculations, but at least this incident showed that Swiss citizens began to question the current monetary system. In the long run, it will undoubtedly be more favorable to Bitcoin.