Martin Schlegel, the Chairman of Swiss National Bank (SNB), has described cryptocurrencies like Bitcoin and Ethereum as a “niche phenomenon” and unlikely to be a mainstay of the Swiss financial ecosystem soon despite their rapid growth in recent years.
Speaking at an event in Brugg, Switzerland, Schlegel reportedly reiterated that while assets like Bitcoin and Ethereum have experienced “enormous” expansion, they remain largely unsuitable for everyday use due to their notorious volatility. He noted that this volatility limits their role in Switzerland’s payment ecosystem, which relies on stability and reliability.
Schlegel expressed reservations over the high energy demands of cryptocurrencies and their ties to illicit activities, which pose challenges for effective regulation.
However, he emphasized that the Swiss National Bank remains open to technological innovation, mentioning an ongoing pilot project for a central bank digital currency (CBDC) aimed at enhancing interbank payments. Despite this exploration into digital currency, he reaffirmed the SNB’s commitment to maintaining cash as a key part of the Swiss financial landscape.
“Despite the digitalization of the electronic payment system, we believe that cash will play an important role in the future,”
Schlegel stated.
This aligns with the views of former SNB Chairman Thomas Jordan, who remarked earlier in April that the risks of introducing a public CBDC likely outweigh its benefits. Jordan emphasized that the private sector already offers a variety of efficient digital payment methods, suggesting that a retail CBDC could disrupt the established monetary structure.
Schlegel’s comments come as Swiss financial institutions show growing interest in digital assets. Recently, UBS announced that it had completed a successful pilot of UBS Digital Cash, its blockchain-based payment system designed to streamline cross-border transactions in multiple currencies. Meanwhile, Zurich Cantonal Bank (ZKB) launched 24/7 trading for Bitcoin and Ethereum through its digital banking platforms, integrating these assets into client portfolios. Additionally, SIX Group, Switzerland’s stock exchange operator, revealed that it is developing a new crypto trading platform for institutional investors, which will support both spot and derivatives trading.
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