Bitcoin News Today: Philippines Bets on Bitcoin as a Hedge Against Global Uncertainty

The Philippines is advancing a proposal that would mandate its central bank to establish a strategic reserve of 10,000 Bitcoin over a five-year period. Introduced as House Bill No. 421 by Congressman Miguel Luis Villafuerte, the bill—known as the Strategic Bitcoin Reserve Act—aims to position the country among the first in Southeast Asia to adopt Bitcoin as a long-term strategic asset. Under the proposed legislation, the Bangko Sentral ng Pilipinas (BSP) would be required to purchase 2,000 Bitcoin annually and store it in cold storage for at least 20 years. The reserve would be safeguarded in trust, with restrictions on selling or swapping the coins unless used to retire government debt [1].

The bill outlines a formal “Bitcoin Purchase Program” to be overseen by the BSP, with support from the Department of Finance, the Department of Defense, and the Securities and Exchange Commission (SEC). A key requirement is the implementation of a proof-of-reserves system, which would involve quarterly public audits conducted by independent third parties. These audits would disclose details such as holdings, transactions, and the control of private keys to ensure transparency [2]. Villafuerte emphasized the need for the Philippines to diversify its national assets beyond traditional reserves like gold and the U.S. dollar, citing Bitcoin’s potential as a hedge and its historical growth rate of 40% over the past five years [1].

The proposed reserve would be valued at approximately $1.1 billion at current market prices. Supporters argue that acquiring Bitcoin could bolster financial stability in an era of global economic uncertainty and provide an alternative to volatile fiat and gold reserves. Villafuerte also pointed to the example set by El Salvador, which has accumulated 6,276 Bitcoin, and Bhutan, with nearly 10,565 Bitcoin in its reserves [1]. If passed, the Philippines would surpass El Salvador in Bitcoin holdings and approach Bhutan’s total. However, critics and skeptics have raised concerns about the risks of investing public funds in a volatile digital asset, with some referring to Bitcoin as a “decentralized Ponzi scheme” and questioning the long-term viability of the proposal [4].

The bill is part of a broader global trend of governments exploring digital assets as part of their financial strategies. Unlike the United States and Germany, which have accumulated Bitcoin through law enforcement seizures, the Philippines would acquire its reserve through scheduled purchases. Proponents of the bill, including cryptocurrency industry leaders, argue that early accumulation could offer strategic advantages as Bitcoin’s supply nears its maximum limit of 21 million coins. However, the proposal is likely to face political and economic scrutiny, particularly regarding the allocation of resources and the management of potential market risks [3].

The legislative process for the bill is still in its early stages, with the House of Representatives set to deliberate on its feasibility. While there is no indication that the bill will be passed soon, its introduction has sparked a broader conversation about the role of Bitcoin in national financial strategies. Industry experts have suggested that even if the bill fails to gain full legislative approval, it could encourage private and corporate entities in the Philippines to explore Bitcoin for their own balance sheets [3]. The debate over the Strategic Bitcoin Reserve Act reflects a growing interest in reimagining national financial reserves in the context of digital innovation and global economic shifts.

Source:

[1] Philippine bill charts path to strategic reserve (https://cointelegraph.com/news/philippine-bill-strategic-bitcoin-reserve-10000-btc)

[2] Philippines Proposes Massive 10,000 Bitcoin Buy for Strategic (https://finance.yahoo.com/news/philippines-proposes-massive-10-000-172644985.html)

[3] Philippines to Consider Strategic Bitcoin Reserve With 20 (https://finance.yahoo.com/news/philippines-consider-strategic-bitcoin-20-014115647.html)

[4] Philippines proposes massive 10000 BTC strategic reserve (https://www.reddit.com/r/Buttcoin/comments/1mxyhbv/philippines_proposes_massive_10000_btc_strategic/)