An executive at a prominent Ghanaian holding company has urged Ghana’s central bank to invest one percent of its reserves in bitcoin.
Speaking with Accra-based publication Joy Business, Papa-Wassa Chiefy Nduom -- vice president of Groupe Ndoum -- said that bitcoin has grown so large that central banks can no longer ignore its use case as a global reserve asset.
Citing reports that predict the US dollar will decline against other reserve currencies in 2018, Nduom said that USD-heavy African central banks such as Ghana should consider purchasing a small amount of bitcoin while it is at a low point relative to the all-time high it set in mid-December.
“I don’t think it’s a gamble, I think every investment is a gamble, getting out of your bed in the morning is a gamble. If you are completely preoccupied with risk you won’t do anything… in terms of managing reserves there is potentially a new reserve asset and as a central bank, you need to study blockchain,” he said.
He said that bankers should not consider it “unreasonable” to purchase bitcoin at this juncture, especially considering that its price would almost certainly appreciate once news broke that a central bank was holding cryptocurrency.
Ndoum, who said that he first became interested in bitcoin in 2013, added in a blog post that if African countries did not embrace bitcoin soon, the continent could find itself left behind as the world undergoes another technological revolution.
“Bitcoin nodes are all over the world but Africa is a very conspicuous dark spot. Africa keeps getting left behind. Not just Africa, Africa and the Diasporas created as a result of economic migration and the transatlantic slave trade,” he wrote. Politically, I feel like if the economic scales are not balanced soon, when the sun goes out, people with a high portion of melanin in their skin will be grossly underrepresented on the spaceship.”
On the other hand, he said that if Africa did embrace bitcoin it could unify the continent around a digital reserve asset that the countries could then leverage to fund infrastructure development and alleviate poverty.
As an added benefit, he wrote, investing in publicly-verifiable assets like bitcoin would give the public increased ability to monitor government reserves, preventing administrations from hiding budget deficits, as happened recently in Ghana -- to the tune of $1.6 billion.
“I think that they are probably the best entities [central banks] positioned to make an initial bet on this technology because it’s the future of value and banking and as I mentioned many prominent investors are backing this technology and we as a poor country cannot risk being left out on it again,” he concluded.
Write to Josiah Wilmoth at josiah.wilmoth(at)ccn.com.
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