At the World Economic Forum in Davos, Lesetja Kganyago, Governor of the South African Reserve Bank, expressed skepticism about incorporating Bitcoin into national strategic reserves. He questioned the rationale behind selecting Bitcoin over other assets, highlighting the historical significance of gold in such reserves.
Kganyago emphasized the necessity for public policy discussions before adopting new reserve assets, cautioning against the influence of industry lobbyists advocating for specific products without aligning with governmental strategic objectives.
In contrast, Brian Armstrong, CEO of Coinbase, argued that Bitcoin surpasses gold as a form of money due to its provable scarcity, portability, and divisibility. He suggested that governments might begin by allocating 1% of their reserves to Bitcoin, potentially increasing this share over time.
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This debate occurs amid U.S. President Donald Trump’s endorsement of Bitcoin as a strategic asset, proposing the establishment of a U.S. Bitcoin reserve to bolster economic stability.
In South Africa, while cryptocurrencies are classified as financial products under the Financial Advisory and Intermediary Services Act, there is no comprehensive legal framework governing their activities. Kganyago’s remarks reflect the cautious approach of South African regulators toward integrating emerging technologies into the financial system.
The discussion underscores the broader global conversation on the role of digital assets in national reserves, balancing innovation with economic security.
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