Switzerland is well known for its hidden but lucrative gold reserve. The nation has the seventh-largest gold reserve globally, and this achievement does not come easily. To maintain such an astonishing level of wealth, you must constantly be on your toes to defend it from would-be invaders. One way would be to strike an alliance with another country.
Switzerland has recently become an ally of China, their largest gold trading partner. China is aware that Switzerland’s gold reserve accounts for at least 10% of its total currency. Together, they maintain six hundred million ounces which is the equivalent of the United States’ entire supply.
And now, rumors are coming in that the two countries are planning to make another move. According to media reports, they plan to create a gold-backed cryptocurrency with the Swiss Bankers Association (SBA) at their backs.
First of all, it will mean that Switzerland is finally joining the crypto bandwagon and giving its approval of Bitcoin. The second would be China that is very much against cryptos taking the front seat in this matter. So this will be an excellent boost for China which has been at loggerheads with cryptocurrencies, especially when it comes to ICOs.
Switzerland follows Japan’s lead when it comes to cryptos. Japan has recently passed regulations that will treat cryptos like conventional assets and pave the way for them to be used in institutional settings.
There is also the huge possibility that the SBA will make their coin backed by the Swiss gold reserve. This could be a new age for cryptos since most of them are backed by fiat currency, which is unstable. If SBA releases its coin, it will be based on the Swiss franc- the most stable currency in the world.
This new crypto could have a significant impact if this report is accurate. It can trigger China to develop its cryptocurrency backed by its gold reserves. That would mean that they will also be joining the crypto bandwagon. You need to just click here to learn and start crypto trading.
And just like that, everyone will officially have a crypto war on their hands.
What is the impact of Bitcoin on Switzerland’s business industry?
There is no doubt that Switzerland has one of the most open and stable economies globally. Therefore, cryptocurrencies like Bitcoin can benefit them greatly. First of all, it can boost their economy since cryptos are getting popular by the day.
Secondly, they would take advantage of blockchain technology, making their business (especially the financial industry) better.
Also, Switzerland is one of the wealthiest countries globally with great mineral resources, which could mean getting richer every day. So if they are investing in cryptocurrencies, there has to be a high possibility that it will make them even more prosperous.
Cryptocurrencies are volatile, meaning they can gain or lose value in a short period. This could cause problems for the business industry since it wouldn’t accommodate quick changes in fiat currency prices, not to talk about how expensive cryptos are.
There is also the issue of Bitcoin being entangled with criminal activities- something that has been a thorn in the side of most governments. However, Switzerland may follow Japan’s example by treating cryptos like fiat currency used for business transactions.
Nevertheless, it would still be great if SBA came up with their coin backed by gold reserves. This would strengthen the Swiss economy, but it could also be used by other countries, especially those that are very rich.
There will be more to gain than loss with cryptos like Bitcoin in the business industry. It will boost the economy and remove some of the problems they have been having so far.
Cryptocurrencies have been a controversial matter since it was introduced to the world. While many people see its benefit, some stick with fiat currencies since they have been using them for decades already.
In any case, Switzerland joining the bandwagon is very significant. First of all, they are a wealthy nation which means that they can gain even more wealth. They will also take advantage of blockchain technology, making their business environment better.
There has been a lot of opposition against cryptos due to the volatility and criminality aspect. However, this move from SBA shows that Switzerland recognizes Bitcoin and other cryptocurrencies as assets, which can be used in business transactions.
If this trend continues, there is a big possibility that other countries like China will join the bandwagon too. That would mean more cryptos in the international scene, further strengthening blockchain technology.