Tuesday11 February 2025
manipulyator.in.ua

The head of the Czech central bank aims to purchase billions of euros worth of Bitcoin.

The head of the Czech National Bank is considering transferring the country's reserves, amounting to billions of euros, into Bitcoin. This groundbreaking move could position it as the first Western central bank to hold crypto assets.
Глава чешского центробанка планирует приобрести биткойн на миллиарды евро.

This is reported by the Financial Times.

The Chairman of the Czech National Bank, Aleš Michl, announced that he will present a plan to invest in Bitcoin as a means of diversifying the CNB's reserves at a meeting on Thursday. According to him, if the board approves this plan, the CNB could ultimately hold up to 5 percent of its €140 billion reserves in Bitcoin.

"For diversifying our assets, Bitcoin seems like a good option. These guys [Trump] might create a certain bubble for Bitcoin, but I believe the trend will continue to grow without them, as it provides an alternative [investment] for more people," said Michl.

Central banks traditionally keep their reserves in conservative assets, such as U.S. Treasury bonds and other high-rated bonds. Some do hold stocks, but almost none have publicly invested in cryptocurrencies.

Michl stated that he has "a completely different philosophy" regarding Bitcoin compared to his colleagues.

Last year, representatives of the European Central Bank wrote that "the fair value of Bitcoin is still zero," adding that "Bitcoin is not suitable as a means of payment or as an investment," while former ECB official Benoît Cœuré previously called Bitcoin "the evil spawn of the financial crisis."

Reports indicate that if the Czech bank had held 5% of its foreign currency reserves in Bitcoin over the past decade, its annual return would have increased by 3.5%, but volatility would have also doubled.

The central bank's foreign currency reserves of €140 billion are roughly equivalent to 45% of the Czech Republic's GDP. The CNB already stands out among central banks, with 22% of its portfolio consisting of stocks, and Michl aims for half of this portfolio to consist of U.S. stocks in three years, compared to the current 30%.

Reminder:

U.S. President Donald Trump ordered the creation of a working group on cryptocurrencies, which is expected to propose new regulations for digital assets and explore the possibility of creating a national cryptocurrency reserve.

Bitcoin, other cryptocurrencies, and even the newly minted token named after Donald Trump cooled off on January 21, after the first package of programs from the U.S. President following his inauguration made no references to this asset class.

Bitcoin surged to a record high above $106,000, spurred by comments from newly elected President Donald Trump, who suggested he plans to create a U.S. strategic reserve of Bitcoin, similar to the strategic petroleum reserve.