This proposal outlines a hybrid currency peg that anchors our national currency to a composite index of gold, Bitcoin, and a Kuwait-style currency basket. The objective is to combine stability, diversification, and innovation in monetary policy.
The proposed weights are: 40% gold, 20% Bitcoin, 40% international currency basket.
| Asset | Weight |
|---|---|
| Gold (per gram) | 40% |
| Bitcoin (0.0005 BTC) | 20% |
| Currency Basket (USD, EUR, JPY, GBP, CHF, CNY) | 40% |
Since 2003, the Central Bank of Kuwait has pegged the Kuwaiti Dinar to a diversified basket of major currencies. Although the precise weights are proprietary, this practice has provided long-term stability, low inflation, and resilience against oil revenue volatility. It demonstrates the effectiveness of basket-based pegs for monetary stability.
A dedicated Monetary Policy Council would oversee index updates, reserve audits, and intervention rules. Quarterly reports to Parliament and an independent audit by the central bank are mandatory.
| Benefits | Risks & Mitigations |
|---|---|
| Diversification reduces single-asset shocks | Bitcoin volatility → cap weight at 20%, build volatility buffer |
| Gold provides long-term stability | Reserve cost → phased accumulation over 3 years |
| Currency basket aligns with trade flows | Complex reserve management → automated FX operations |
| Signals innovation in monetary policy | Regulatory pushback → stakeholder consultations |
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