Even though Switzerland is among the most pro- crypto countries in the world, it seems that the nation rejected the Sovereign Money Initiative that was aimed at restricting the issuing of digital money for banks.
Ever since Bitcoin came into existence, banks and cryptocurrency have been in conflict with one another. This is because while cryptocurrencies are decentralized, banks on the opposite side of the spectrum, being highly centralized. Another factor would be in terms of supply, and while cryptos are produced in a limited number, the supply of fiat currency can be increased easily.
Switzerland Turns Down Pro-Crypto Mandate
A group going under the name of MoMo recently led the Sovereign Money Initiative. The implementation of this proposal would have transformed the country’s financial industry and make it resemble that of cryptocurrency. The most important aspect of the initiative was that banks could not produce electronic money if they happen to lend more than what they have deposited (which happens very regularly).
Nonetheless, the Swiss citizens voted against the Sovereign Money Initiative. Emma Dawnay, a member of the MoMo board, said the following regarding the failed initiative:
“Cryptocurrency and the blockchain does look like where we’re heading. It could have been used under the system we were proposing. Blockchain technology could be how the Swiss government could try to bring debt free new money into the economy. Despite the vote losing the Swiss central bank is looking at similar things.”
Still Some Hope
In spite of the initiative’s failure, the situation is not all that grim. A full 25% of the poll’s participants (counting 500,000 individuals) were in favor of the proposal. Unsurprisingly, the Swiss National Bank also opposed the proposal, its president, Thomas Jordan, deeming it a “dangerous experiment.”
MoMo stated that it will continue trying to transform the country’s financial system. Raffael Wuethrich, the spokesman of the campaign said:
“The discussion is only just getting started. Our goal is that money should be in the service of the people and not the other way around and we will continue to work on it.”
“The way money currently comes into circulation still isn’t well understood. Before we can expect change we need to educate people about how money is created and the established institutions which benefit from it,” added Emma Dawnay.
If the Sovereign Money Initiative will gain traction in the next political cycle remains to be seen. As for the Swiss National Bank, it is actually exploring ways of using blockchain technology to supervise its financial transactions.
The initiative’s failure revealed just how much work is required, and it will involve considerable efforts to educate people about the procedures behind the current economic system, along with the advantages of cryptocurrencies.