The Japanese government is still wary of keeping Bitcoin in its national reserve due to the volatility issue of crypto assets. It further showed that crypto assets, including Bitcoin, do not fall under the category of foreign exchange. This is inconsistent with the present system, and that is one major reason for their decision.
The government answered a query from Senator Satoshi Hamada on Dec. 20. He had inquired about efforts to add Bitcoin to the reserves of the US and other nations. The response from Prime Minister Shigeru Ishiba made Japan’s stance clear.
Senator Hamada of the Party to Protect the People from NHK has called on Japan to join the United States and other nations in converting part of its foreign exchange reserves into cryptocurrencies like Bitcoin.
Early stages ofglobal Bitcoin reserve discussions
However, the government acknowledged that it had not thoroughly evaluated events overseas. Additionally, it noted that talks regarding Bitcoin reserves were still in their early phases. Therefore, taking a firm stand on the issue would be challenging. The purpose of the country’s foreign exchange reserves is to stabilize the bond and asset markets denominated in foreign currencies.
The government emphasized that these reserves’ security and liquidity must come first. The price fluctuations of Bitcoin are incompatible with the stability needed for foreign exchange reserves.
Nevertheless, Japan’s cautious approach demonstrates its reluctance to adopt such a high-risk asset for national reserves despite the global discussion surrounding crypto assets.
