Vancouver Mayor Ken Sim plans to press on in gathering support for investing in digital currency, despite the skepticism of the provincial minister, whom he needs on board.JACKIE DIVES/The New York Times
British Columbia’s Municipal Affairs Minister responded with a flat no this week to a suggestion by Vancouver’s mayor that the province allow the city to hold some of its reserves in the best known of the cryptocurrencies, bitcoin.
“I certainly won’t be moving anything. It’s just not a priority. We’ve got way too many important issues – health care, housing – to deal with,” Ravi Kahlon said.
A local economist who specializes in the social and environmental effects of bitcoin mining has said somewhat dismissively that the current enthusiasm of people such as Mayor Ken Sim for the digital currency is “a thing in the manosphere.”
“It’s popular among young males,” said UBC Sauder School of Business professor Werner Antweiler.
But that isn’t stopping Mr. Sim from pursuing the idea and talking about it with excitement.
It’s an incredible holder of value, the mayor said in an interview with The Globe and Mail, before listing the benefits of the currency: It’s the top-performing asset of the past 16 years. It’s better than gold. It can’t be captured by a military force. It can put Vancouver on the map as a world leader in bitcoin innovation.
“If we are able to incorporate bitcoin, that could set Vancouver up for the next 100 years,” he enthused. The price of Bitcoin surpassed $100,000 earlier this month compared with about $300 10 years ago.
So he plans to press on, despite the skepticism of the provincial minister, whom he needs on board to make his idea a reality.
“It would be irresponsible not to look at the merits of this. What we’re asking is for the residents of Vancouver and B.C. and Canada to do this work,” Mr. Sim said after getting city council to agree last week to have staff explore the idea of allowing people to pay municipal bills in bitcoin and have a small portion of the city’s financial reserves held in the currency.
It’s a proposal that has attracted buzzy media attention, along with both bitcoin critics and fans weighing in on the idea.
For the general public, though, it’s mostly a mystifying subject.
More than three-quarters of Canadians surveyed for a 2023 Ontario Securities Commission report said they have never owned cryptocurrency. Almost half cited concerns over potential risk as the top reason for that, while others said they lacked knowledge about digital currency or worried about being scammed. As for the “manosphere” thing, the survey showed the most enthusiastic group using it is men between 25 and 44 years of age – 53 per cent of those surveyed owned crypto funds or assets.
Comparatively, only 17 per cent of Americans have ever invested in or used any kind of cryptocurrency, according to a 2024 Pew Research Center study. Two-thirds of the American public isn’t confident about its safety or reliability, fearing that it can be used by criminal organizations or that it’s little more than Monopoly money. As in Canada, men led the demographics – 42 per cent between 18 and 29 years of age have invested in it or used it.
Complicating things is the fact that any discussion of it tends to be shrouded in baffling language.
A Wikipedia explanation of how bitcoin was created by an anonymous inventor in 2008 notes that it started with the innovation of a “complex interplay resulting in the first decentralized, Sybil-resistant, Byzantine-fault-tolerant digital cash system.”
Or there’s this entry on the Investopedia website: “Bitcoin mining is the process by which transactions are officially entered on the blockchain. It is also the way new bitcoins are launched into circulation. Mining is conducted by miners using hardware and software to generate a cryptographic number that is equal to or less than a number set by the Bitcoin network’s difficulty algorithm.”
It tends to be understood for the most part by people who are comfortable arguing the merits of fiat currency or the centuries-old reliance on gold as a financial reserve for state governments.
It also can’t be spent easily and, technically, is supposed to be reported in Canada as a capital gain if it is used.
Enthusiasts say it’s a powerful new technology that brings the kind of transparency and access to the monetary system that doesn’t exist in state-controlled banking systems.
“Crypto is the way of recognizing the value of data,” said James McKee, the head of digital strategy at the Vancouver arts group 221A. He described it as a “teenage technology” that is currently going through its rambunctious phase, but argues it opens up the financial system to more democratic controls.
He recommends, though, that the city not try to use bitcoin as a way of paying for day-to-day operational services. Instead, he said, it should be held as a financial asset on the books.
Victoria Lemieux, a co-lead at UBC’s Blockchain@UBC research cluster, dismissed the popular idea that it is more prone to being used by criminal or terrorist organizations.
“City policy should not be based on the faulty premises that criminals choose bitcoin and, relatedly, that bitcoin is primarily used for crime,” she said.
But those cautioning against a fulsome embrace of the currency say it is risky because it has no underlying value.
It’s not a rent-generating property or an energy source or a mine producing real metals. Instead, they say, it’s more like art or Dutch tulip bulbs: something that appears to have a lot of value because many people say it has value.
“The value is entirely what people think it will produce in the future,” said Prof. Antweiler, who has a blog on the topic and emphasizes how environmentally harmful bitcoin mining is because of how much electricity it uses.
Mr. Sim doesn’t care. He said he, too, was a skeptic about it all a decade ago, when one of his sons got interested in cryptocurrency and talked to him about it. Now he’s convinced “it’s an incredible invention.”
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