Swiss National Bank's Stance on Cryptocurrencies

BRUGG, Switzerland (Reuters) – The Swiss National Bank (SNB) remains cautious about cryptocurrencies like Bitcoin and Ether, according to Chairman Martin Schlegel during an event in Brugg, Switzerland, on Thursday.

"Bitcoin and other virtual currencies have grown enormously in recent years," Schlegel stated. However, he emphasized that despite this growth, cryptocurrencies still represent a niche phenomenon.

Schlegel expressed concerns regarding cryptocurrencies, citing their significant value fluctuations, which render them impractical for payments. He also highlighted their high energy consumption, association with illegal activities, and the challenges of regulation.

Nonetheless, the SNB is not falling behind on technological developments. Schlegel mentioned that the SNB is conducting a pilot project on central bank digital currency to facilitate payments between financial institutions. Additionally, as of August, the central bank has implemented instant payments, allowing fund transfers to occur within seconds rather than days.

Schlegel reiterated the importance of cash in the payments system, mentioning that the SNB plans to introduce a new range of banknotes. "Despite the digitalization of the electronic payment system, we believe that cash will play an important role in the future," he remarked. "Cash offers many advantages. It does not require any technology and is anonymous; you can simply pay with a banknote."