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The Vancouver City Council has approved a plan to investigate the potential of using Bitcoin in municipal financial operations, such as taking Bitcoin as payment and keeping it as a reserve asset.
At Wednesday’s council meeting, Mayor Ken Sim’s motion—which had the backing of six councilors—effectively instructed city staff to investigate the possibility of turning Vancouver into a “Bitcoin-friendly city.”
As an investor in Coinbase Global Inc., Mayor Sim thinks that incorporating Bitcoin into the city’s budget will protect its purchasing power from inflation. He has committed to donating $10,000 worth of Bitcoin to the establishment.
“Our family is going to donate $10,000 to the City of Vancouver in the form of bitcoin and this is going to be a gift to the city that we love,” he said during the meeting. “We totally believe in the benefits of this and we’re putting our money where our mouth is.”
Experts & Officials Oppose Vancouver’s Bitcoin Reserve Proposal
Due to the unstable price of Bitcoin, local experts and government leaders are against the plan.
According to the Ministry of Housing and Municipal Affairs, cryptocurrency cannot be accepted as payment for “municipal services or other transactions” under either the Community Charter or the Vancouver Charter. Local governments are not permitted to maintain financial reserves in digital assets, according to the ministry.
Although he was opposed to the proposal, Green Councillor Pete Fry voiced his concerns regarding illegal activity.
He said, “In the absence of any really specific acknowledgment of … the very serious issues around money laundering and the history in this city, I don’t think this is a step in the right direction.”
Vancouver to Assess Bitcoin Reserve Feasibility by 2025
Now that the initiative is underway, city officials must assess it and provide a comprehensive report detailing the initiative’s pros, disadvantages, and practical issues for Bitcoin asset management by the end of Q1 2025. According to the plan, financial advisors, crypto experts, and community members will be consulted.
Since the election of Donald Trump, there has been a noticeable increase in the efforts to promote the use of Bitcoin. Trump has stated his desire to make rules more favorable to the cryptocurrency industry.
The trend is now spreading around the world, and politicians in other countries are talking more and more about creating a strategic Bitcoin reserve. The Canton of Bern, Switzerland, approved a plan last month to investigate Bitcoin mining as a means of reducing grid instability and excessive energy consumption.
