Bitcoin not an 'allowable asset': Vancouver city staff asks council to drop BTC reserve motion
Vancouver city staff has advised the council to rescind a motion to make the city "bitcoin-friendly" following a legal review.
In a report submitted recently to the Vancouver City Council, the staff moved to scuttle the motion titled "Preserving of the City’s Purchasing Power Through Diversification of Financial Reserves – Becoming A Bitcoin Friendly City," which was presented in November 2024.
"Staff has conclusively determined that under the Vancouver Charter, Bitcoin is not an allowable investment asset for the City, and therefore recommends that this work be concluded," the report said. The Vancouver Charter is the provincial law that governs various city operations.
The report also cited the need to reprioritize staff resources and coordinate with other city initiatives as additional rationales for the recommendation.
Undue risk
The 2024 motion, presented by Mayor Ken Sim, sought to diversify the city's financial reserves and protect its purchasing power against inflation and volatility by allocating a portion of municipal funds into bitcoin (BTC). Sim had touted bitcoin as "the greatest invention in human history" and pledged to donate $10,000 worth of bitcoin to the city.
In December 2024, the Vancouver City Council approved the motion directing city staff to assess the feasibility of building a bitcoin reserve. While the council asked staff to assess the motion and report back by the first quarter of 2025, no report was publicly disclosed until earlier this week.
According to a CBC report, the Ministry of Municipal Affairs of British Columbia stated at the time that local governments, including the City of Vancouver, are not permitted to hold financial reserves in crypto, citing concerns about exposure to "undue risk."
Since late 2024, bitcoin has had a tumultuous run, reaching an all-time high of over $126,000 before falling 50% to lows of around $63,000 over four months. As of today, the world's largest cryptocurrency is trading at $70,166.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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