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Vancouver City Council is considering a proposal to consider Bitcoin as a reserve asset. The proposal aims to diversify the city's financial reserves, despite opposition citing Bitcoin's volatility and legal restrictions.
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Vancouver City Council will meet today to discuss a number of topics, including Mayor Ken Sim's proposal to consider Bitcoin as a reserve asset for the city.
The motion, titled “Maintaining the City’s Purchasing Power through Diversification of Fiscal Reserves – Becoming a Bitcoin-Friendly City,” aims to hold a portion of the City’s fiscal reserves in Bitcoin and make digital assets available to the City. It is proposed to consider the option of accepting it as a tax or fee.
Mayor Ken Sim’s motion
Mayor Sim hopes that adopting Bitcoin as part of the city's fiscal strategy will help fight inflation and protect purchasing power. He said incorporating Bitcoin could prevent traditional currencies from devaluing.
If approved, city staff will conduct a comprehensive analysis of the initiative, with a detailed report expected by the end of the first quarter of 2025. This study examines the risks, benefits, and practical considerations of managing Bitcoin as an asset.
This plan includes consultation with financial advisors, cryptocurrency experts, and community stakeholders to assess the impact of Bitcoin adoption. The initiative follows similar approaches taken by cities such as Zug in Switzerland and El Salvador.
However, the motion faces opposition from local experts and government officials, citing Bitcoin's volatility and existing legal regulations. Current British Columbia regulations allow municipalities to invest money in low-risk financial products. Cryptoassets like Bitcoin are not among the approved options.
The discussion comes as Bitcoin has regained the $100,000 level on expectations that the Fed will cut interest rates following recent inflation reports.
Mayor Sim has expressed his belief that Bitcoin has the potential to transform the financial system and aims to position Vancouver as a leader in adopting innovative financial strategies.
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