Taiwan’s economy is facing pressure as foreign exposure shakes the stability of the new Taiwan Dollar currency.
Lawmakers suggest adding Bitcoin to their preparations as a hedge against inflation and global risks.
US states like New Hampshire have already approved Bitcoin for their official reserve diversification strategies.
As Taiwan deals with global inflation and increasing geopolitical risks, lawmakers are now raising bold questions. Is it time to treat Bitcoin as part of the country’s fiscal defense plan?
The idea has been supported by experts and former officials. Will Bitcoin help protect Taiwan’s economy in times of uncertainty?
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Taiwan warned about the currency crisis
Taiwan’s economy is heavily built on exports and is highly exposed to foreign markets. This has recently changed the value of the new Taiwan Dollar. As an export-driven country, Taiwan is heavily affected by global inflation and rising tensions between major countries.
Taiwanese lawmaker Kocheong asked the government to include Bitcoin in its diverse reserves, along with its gold and foreign exchange reserves. He said Bitcoin has hedging properties, which will help improve the resilience and adaptability of Taiwan’s financial system.
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Currently, Taiwan holds 423 metres of gold and has a foreign exchange reserve of approximately USD 577 billion. However, there are catches and over 90% of these reserves are invested in the US Treasury.
Experts worry that in the event of a major conflict or financial shock, these traditional assets will lose value or be difficult to use immediately. These changes have raised questions about how secure the country’s financial reserves are.
New Proposal: Add Bitcoin to National Reserve
To address this issue, in a recent parliamentary session, Taiwanese Congressman Ko Ju-Chun proposed that the government should consider adding Bitcoin to Taiwan’s national asset reserves.
He believes Bitcoin can act as a hedge against inflation and global risk. With 21 million coins fixed in Bitcoin, decentralized and difficult to control or block, Ko says it can protect Taiwan more during uncertain times.
He doesn’t want to exchange gold or US dollars, but he’s asking for a small portion of Bitcoin to his reserves to make Taiwan more flexible in the future.
Increased support for Bitcoin initiatives
KO’s idea has been supported by important figures like former Premier Chiang Kong. Recently, they have said that Bitcoin may not be used like everyday money, but it is a powerful asset to protect inflation.
At the same time, Professor Li Yiru of National Taiwan University pointed out that the limited supply of Bitcoin is different from traditional currencies that can be printed in large quantities during the crisis.
Other countries are taking action too
Taiwan is not alone in this way of thinking. In the US, New Hampshire had just passed the Bitcoin Reserve Act, officially allowing Bitcoin to become part of the state’s financial reserves. Other regions are also investigating similar steps to prepare them for future risks.