Countries around the world appear to be racing to create strategic Bitcoin reserves, with lawmakers in Hong Kong and Germany putting forward the proposal. A Hong Kong Legislator said the inclusion of Bitcoin (BTC) in the city’s Exchange Fund would help maintain financial security amid changing global crypto dynamics. In the wake of Donald Trump’s victory, countries are taking a more serious look at BTC as a national reserve to navigate shifts in the global economy.
Hong Kong eyes strategic Bitcoin reserve
Wu Jiezhuang, Chairman of the Hong Kong Web3 Crypto Asset Development Subcommittee, proposed that Hong Kong take advantage of “One Country, Two Systems” to pilot the inclusion of Bitcoin in the Exchange Fund. The Treasury Bureau’s response stated that as of now, crypto assets are not targeted investments for the Exchange Fund. However, it added that external investment managers may have small exposure to crypto assets through diversified portfolios.
Hong Kong may be well on its way to a strategic Bitcoin reserve considering its crypto-friendly efforts over the past few years. As of now, the Hong Kong Stock Exchange lists 12 cryptocurrency-linked ETFs with a total market capitalization of approximately HK$7.4 billion. Furthermore, with other small countries like El Salvador setting a precedent, Hong Kong could make a similar move in the future.
Does China already have Bitcoin?
Local news outlet DW Media said that China owns around 190,000 Bitcoins. This is second only to the US government’s 210,000 Bitcoins. At current prices of $94,000 per Bitcoin, this would be worth about $18 billion. Market analysts believe the city could convert these assets into ETFs listed in Hong Kong. After Donald Trump won the 2024 US Elections, some US states have proposed legislation to hold 10% of government reserves in Bitcoin. Wyoming Senator Cynthia Lummis recently reaffirmed her commitment to implement a strategic Bitcoin reserve plan for the US and to accumulate more than 1 million Bitcoins compared to the previous proposal.
Will Germany also make a BTC move?
Former German Finance Minister Christian Lindner has suggested that the European Central Bank (ECB) and the German Bundesbank should consider adding Bitcoin to their reserves. This comes shortly after a European lawmaker made a similar request last week. Speaking to the German Press Agency in Berlin, Linder said
The new Trump administration has a very progressive policy on cryptoassets like Bitcoin. In Washington, there is even talk of the FED including crypto assets in its reserves alongside currencies and gold.
He said the US aims to be the global leader in USD and crypto. “However, Germany and Europe must not let them fall behind again. In Frankfurt, it should be examined whether crypto assets can also become part of central bank reserves,” he added. Besides Hong Kong and Germany, even Russia is trying to create a strategic Bitcoin reserve in the wake of global sanctions. Japan, on the other hand, has currently rejected this proposal.
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