Ghana Urged To Invest 1% Of Its Reserves In Bitcoin

The vice president of investment bank Groupe Nduom, Papa-Wassa Chiefy Nduom, has urged the Bank of Ghana to diversify its investment by placing about one percent of Ghana's reserves in bitcoin.

 

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According to GhanaWeb, Ndoum deflected arguments that it is too volatile by saying: “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, “Everybody agrees with that now…IMF and the rest, they’ve all said blockchain is potentially disruptive technology. Some people think it will get rid of banks. So as a central bank, you’ve got to pay attention.”

In an exclusive interview with JoyBusiness, Mr Ndoum said Ghana can have a lot of foreign exchange with the right investments in the digital currency.

In an op-ed, Ndoum showed his math...

 

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He said, “On the investment case, for a central bank, especially for a country that needs to come up with solutions, we need more funding for investments and my view is, by making that investment and by signalling that it’s an enabling environment for investments. For example, if the exchange is domiciled in Ghana trades in the digital currency will not be subject to tax or capital gains but will tax the profit that the exchange is made. That could result in massive inflows of foreign currencies to Ghana.”

“For central banks in Africa, 13 of them that I have studied, in 2016 term, they had about $111 billion in reserves and it’s also projected that the dollar may fall, against other currencies and they [central banks] already have an imperatives to rebalance their dollar holdings based on the current view of where the dollar may go. So for them [central banks] they have to rebalance anyway or they are going to lose money; potentially,” he said.

Mr Ndoum said central banks in Africa “may buy euros, Swiss franc, or Australian dollar or New Zealand dollars but they can also invest in this [bitcoin] because big investors in the world believe that this [bitcoin] will be a new digital reserve currency and reserve currencies are for central banks, and the central banks also have the technical capability to make a decision on this.”

He believes that the digital currency is the future of value and banking, “They [central bank] have the people and staff who can study the technology, the regulation and can make a decision.”

“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 said.

Nduom concludes: "So in 2018 I will be looking for the first African Central Banker who says – I’m tired of putting my hat in my hand and begging – let’s take some risk and dig into this new global, permission-less, robust and extensible financial ecosystem. Everything we need to learn is for free on the internet. I won’t be holding my breath."

Comments

Dutti IH8OBAMA Jan 5, 2018 6:22 AM Permalink

Nduom is a smart guy, living dangerously. He better watch out that the helicopter or private plane he travels in is not "maintained" by somebody who is paid off by the CIA. If he travels by car his death will look even more like an "accident".
As soon as any central banker will prepare to ignore warnings by the US, the IMF etc. not to invest even the smallest amount in Bitcoin he will be a dead man walking.

In reply to by IH8OBAMA

Davidduke2000 Jan 4, 2018 8:50 PM Permalink

what's wrong with africans, they have the gold in the ground, dig it out and use it as your reserves to protect your country's wealth.

ditch the us dollar and keep gold only.

U4 eee aaa Jan 4, 2018 8:50 PM Permalink

So what if the CBs of the world end up buying 7 or 8 million BTC? What will that do to the price?

 

They could buy gold from the gold market but will they be able to take delivery in times of crisis or will they just get promissory notes? At least with the coins they will have them in their wallets

LetThemEatRand Jan 4, 2018 8:51 PM Permalink

Regardless of your views of BTC, 1% is not crazy given the mania.   As many here have pointed out, ride the wave dude.  No different these days from investing in any other bubble on the hope it has more time to run, and if it is the game changer some claim, he'll have some local schools named after him.

Zepper Jan 4, 2018 8:54 PM Permalink

I don't think its a gamble, I think every investment is a gamble...

 

And this is what talking out your mouth and your ass looks like. Perfect example. This is why all african nations have and always will be tribal warfare like breeding grounds...

 

Rex Andrus Jan 4, 2018 8:57 PM Permalink

Too little too late. Try alts. Maybe you can invent the black Ghana princess being raped repeatedly in London prisons after being brutalized into muling narcotics into Ghana from London.

Fuck Kofi Annan's masters. Fuck you. Glass Ghana.

Take It Back 2018

 

Cabreado Jan 4, 2018 9:07 PM Permalink

I always take advice from Ghana.

And of course, everyone always did.

The most fun part is to see the crypto-maniacs latch on to Ghana, now...

Sonny Brakes Jan 4, 2018 9:10 PM Permalink

The problem as I see it is that all investments are measured using the US dollar. The US dollar is a victim of its own success. No matter how many are printed no one ever gets tired of counting them. They don't hold their purchasing power as well as they once did back when they were redeemable for gold. On the other hand, for gold to be a tangible asset it must be recovered from the ground and the cost of recovery will continue to climb. Bitcoin to be a tangible asset needs to be mined using expensive electricity, an ISP connection, computing power, and an electronic wallet, plus the marketplace needs to come around to accepting it. Correct me if I'm wrong, but wouldn't high-end marijuana also be considered a currency. Around here a simple gram of marijuana sells for $10/gram. I think it's doing better than silver at the moment.

Sizzurp Jan 4, 2018 9:23 PM Permalink

All sovereign held currency reserves amount to about 12T, so if they all did just 1%, it would amount to 120B in BTC purchased.  That's about half the current M2.  Estimates are that it's only taken 10B in capital inflows to put BTC at it's current value of 15k.  Now imagine central banks went ahead and did this with 120B, and also imagine how much additional private investment would front run such a move.  I think some of the wildest BTC projections would be looking pretty conservative, easily 750k plus per BTC.  Now ask yourself, isn't it worth owning 1 or 2 just in case?