In a progressive move, Vancouver City Council has approved a proposal to investigate the potential for incorporating Bitcoin into their municipal financial operations. This exploration will look into both the feasibility of holding Bitcoin as a reserve asset and the possibility of accepting it as a form of payment.
This groundbreaking motion, put forth by Mayor Ken Sim, garnered the backing of six councilors during a council meeting this past Wednesday. The decision effectively tasks city staff with the responsibility of determining the feasibility of transforming Vancouver into a “Bitcoin-friendly city.”
Mayor Sim, a shareholder in Coinbase Global Inc., is of the strong opinion that the integration of Bitcoin into the city’s financial strategy could provide a bulwark against inflation, thereby protecting its purchasing power. In a show of faith in the cryptocurrency, he has pledged to donate Bitcoin worth $10,000 to the city.
“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,” Mayor Sim stated during the meeting. “We totally believe in the benefits of this and we’re putting our money where our mouth is.”
However, this proposal has not been without its critics. Local experts and government officials have voiced concerns about Bitcoin’s price volatility. The Ministry of Housing and Municipal Affairs has also indicated that neither the Community Charter nor the Vancouver Charter currently recognizes cryptocurrency as an acceptable form of payment for municipal services or transactions. Furthermore, they have confirmed that local governments are not permitted to hold financial reserves in digital assets.
Green Councilor Pete Fry, an opponent of the motion, also expressed concerns regarding potential illicit activities. “In the absence of any really specific acknowledgement 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,” he stated.
City staff are now faced with the challenge of analyzing the initiative and delivering a comprehensive report by the end of Q1 2025. This report will need to examine the risks, benefits, and practical considerations of managing Bitcoin assets. The plan will also involve consultations with financial advisors, crypto experts, and community stakeholders.
The momentum for Bitcoin adoption has been steadily growing since Donald Trump’s election victory, with the former President expressing intentions to create a more favorable regulatory environment for the crypto industry. This trend has been gaining traction on a global scale, with discussions around a strategic Bitcoin reserve now taking place among lawmakers in other nations as well. Last month, Switzerland’s Canton of Bern approved a proposal to explore Bitcoin mining as a potential solution for excess energy utilization and power grid stabilization.
