Lesetja Kganyago, governor of the South African Reserve Bank, criticized crypto lobbyists at the World Economic Forum in Davos for pushing countries to add Bitcoin to their reserves.
South Africa Central Bank Chief Questions Lobbyists’ Focus on Bitcoin
The governor of the South African Reserve Bank (SARB), Lesetja Kganyago, has slammed crypto lobbyists calling on countries to adopt or add Bitcoin to their respective reserves. Speaking at a panel discussion at the ongoing World Economic Forum in Davos, Switzerland, Kganyago questioned why the lobbyists are focused solely on having Bitcoin added to reserves and not other assets.
According to a Reuters report, the South African central bank governor made these remarks after Coinbase CEO Brian Armstrong told the panel that Donald Trump’s return to the White House would attract investors to crypto. Armstrong also pointed to the significance of having the leader of the world’s largest economy endorse Bitcoin.
However, Armstrong’s endorsement of Trump’s reported plan to create a government Bitcoin stockpile prompted a fiery response from Kganyago.
“I would have a significant problem with a lobby that says governments should hold this asset or hold that asset. There is a history to gold. There was once a gold standard… If we now say ok, bitcoins. What about platinum? What about coal? Why don’t we hold strategic beef reserves, or mutton reserves, or apple reserves? Why Bitcoin,” Kganyago asked.
Regulatory Capture
The South African central bank governor also warned that the crypto industry’s extensive lobbying risked what he called “regulatory capture.” This phrase, which has resonance in South Africa, refers to a scenario where regulatory agencies are unduly influenced or controlled by the very industries they are supposed to oversee.
In the last U.S. elections, several crypto firms and executives openly endorsed and donated millions of dollars to candidates known to be sympathetic to the crypto cause. Many of these candidates won, leading to what has been described as the most pro-crypto U.S. Congress. However, Kganyago suggested that such an outcome could mean “regulation is going to be established through the power of money.”
While the South African central bank governor sees this as a problem, Armstrong argued that crypto firms influencing U.S. elections shows that democracy is working.
