Hong Kong is considering Bitcoin as a reserve to help reduce its significant budget deficit.$SXP $AVA $BTC

The volatility of Bitcoin and the small size of the market create challenges for its acceptance by the government.

Low transaction costs of Bitcoin could make it a better alternative to gold in terms of diversification.

Hong Kong legislator Johnny Ng has a new idea that could help solve the region's financial deficit issue: to include Bitcoin in the city's currency reserves, citing sources in local media.

As the chair of the subcommittee on Web3 and virtual assets development, Ng stated that the current budget deficit, exceeding 100 billion yuan (13.7 billion USD), could be covered by a significant amount of Bitcoin.

He added that having a reserve of Bitcoins could help preserve value, but only a larger distribution would lead to fiscal benefits.