Vancouver City Council Approves Bitcoin Passes Motion To Explore Bitcoin As Hedge Against Inflation

12/13/2024 2:02:23 AM

(MENAFN- eTrendy Stock) Vancouver's city council might embrace crypto as it has voted to explore using bitcoin in municipal finances.

The motion, introduced by Mayor Ken Sim, received strong backing, with six councilors voting in favor, two opposing, and three absent during the decision. The initiative aims to evaluate Bitcoin's potential as a tool to hedge against inflation and currency devaluation.

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Bitcoin Should Belong in a Diversified Portfolio, Says Vancouver Mayor

Mayor Sim, an investor in Coinbase, said Vancouver needs to adapt to global financial trends. Bitcoin's performance over the past 16 years is noteworthy, calling it the“number one performing asset on the planet.”

Before the vote took place, Sim said in an interview with Canadian news outlet Global News that it's“reckless” to not include Bitcoin in a diversified portfolio:

Sim's comments make more sense when looking at Vancouver's housing market, which had a 381% increase in value between 1995 and 2022, contributing to an affordability crisis.

Sim noted that traditional assets like gold and municipal securities have not provided comparable returns. He believes Bitcoin could help stabilize city finances amidst rising inflation and the devaluation of fiat currencies.

Despite gaining majority support, there are some deterrents. Councilor Pete Fry expressed concerns about Bitcoin's environmental impact due to energy-intensive mining and its potential use in illicit activities.

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But most importantly, what limits Vancouver's ability to adopt Bitcoin fully is the amount of legal restrictions. Under current provincial laws, municipalities cannot use cryptocurrency for payments or transactions, while public funds are also restricted to low-risk, approved investments, preventing local governments from holding Bitcoin in reserves.

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