As global interest in Bitcoin reserves grows—fueled by U.S. President-elect Donald Trump’s recent proposal to include Bitcoin (BTC) alongside the U.S. dollar in the national treasury—Japan has firmly stated that it has no plans to adopt the idea, at least for now.
Japan Cites Bitcoin’s Volatility in Rejection
Prime Minister Ishiba Shigeru addressed questions from Senator Hamada Satoshi regarding the international trend toward Bitcoin reserves, particularly in light of developments in the U.S. and other nations.
Shigeru noted that the concept is still in its early stages in the U.S., making it difficult to evaluate its long-term feasibility. He emphasized that Bitcoin does not meet Japan’s criteria for foreign exchange assets, which are primarily designed to stabilize markets and ensure liquidity.
Japan’s foreign exchange reserves focus on currency-denominated assets and bonds, a strategy that stands in stark contrast to Bitcoin’s unpredictable and highly volatile nature. Shigeru reaffirmed the government’s priority of maintaining reserve stability, stating that Bitcoin’s fluctuations would undermine this goal.
Japan’s cautious approach aligns with its previous hesitance to approve Bitcoin-based exchange-traded funds (ETFs), underscoring the country’s conservative stance on cryptocurrencies.
Growing Global Momentum for Bitcoin Reserves
While Japan remains opposed to Bitcoin as a reserve asset, the idea is gaining traction worldwide.
In the U.S., discussions around a national Bitcoin reserve have intensified since Trump proposed the idea. However, Federal Reserve Chairman Jerome Powell recently stated that Bitcoin does not currently meet the legal requirements to serve as a treasury reserve asset.
It is unclear whether Trump will advance the proposal through an executive order after taking office, but the process is likely to be lengthy. Meanwhile, lawmakers in states such as Texas, Pennsylvania, and Ohio have already introduced bills to establish state-level Bitcoin reserves.
Internationally, Russia has also shown interest in developing a strategic Bitcoin reserve, further adding to the global momentum for the concept.
Challenges Ahead
Despite the enthusiasm, significant challenges remain, including regulatory hurdles and concerns over Bitcoin’s stability. For now, corporations appear to be leading the charge: companies like MicroStrategy and over 60 other public firms have already incorporated Bitcoin into their financial strategies, highlighting its growing appeal as a store of value.
While the idea of a national Bitcoin reserve is still in its infancy, it reflects the ongoing evolution of Bitcoin’s role in global finance. Japan’s stance, however, underscores the hurdles that must be overcome before Bitcoin can achieve widespread acceptance as a sovereign reserve asset.
