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HomeBitcoinCzech Central Bank Considers $7 Billion Bitcoin Purchase, Defying Global Skepticism

Czech Central Bank Considers $7 Billion Bitcoin Purchase, Defying Global Skepticism

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  • Czech National Bank proposes $7B Bitcoin investment (5% of reserves), marking a historic shift in central bank crypto strategies.
  • Diversification and U.S. political trends drive CNB’s plan, contrasting global peers skeptical of Bitcoin’s volatility and suitability.

The Czech National Bank (CNB) may become the first major central bank to allocate public reserves to Bitcoin. Governor Aleš Michl confirmed plans to propose a $7 billion Bitcoin investment—roughly 5% of the bank’s $146 billion reserves—during a board meeting this week, according to a Financial Times report. If approved, the move would mark a historic shift in how national institutions approach cryptocurrency.  

Michl cited diversification as a primary motive, noting the CNB already holds 22% of its portfolio in equities, unlike peers favoring stable assets like bonds. He acknowledged Bitcoin’s volatility but pointed to U.S. political shifts, including President Donald Trump’s pro-crypto policies, as factors influencing his proposal. Additionally, Michl referenced rising institutional interest, such as BlackRock’s Bitcoin ETFs, which spurred retail and corporate adoption since their 2023 debut.  

The plan clashes with skepticism from global central banks

Federal Reserve Chair Jerome Powell recently stated the U.S. holds no Bitcoin and has no plans to acquire it. The European Central Bank has repeatedly dismissed Bitcoin’s value, calling it “unsuitable” for payments or investments.

Even El Salvador, which adopted Bitcoin as legal tender in 2021, reduced its crypto exposure this year under IMF pressure.  

Despite institutional hesitance, Bitcoin’s price surged 125% in 2024, outpacing the Nasdaq’s 30% gain. The cryptocurrency briefly crossed $100,000 after Trump’s November election win, fueled by speculation over his administration’s crypto-friendly stance.

While Trump’s recent executive order outlined a digital asset regulatory framework, it omitted direct references to Bitcoin.  

Critics argue Bitcoin’s unpredictability undermines its role as a reserve asset, while proponents view it as a hedge against inflation and geopolitical risks.

The board’s decision, expected soon, could pressure other central banks to reevaluate their strategies ahead of tighter EU crypto regulations set for 2025.  

Michl’s proposal underscores a broader trend

Once-marginalized cryptocurrencies are gaining traction in mainstream finance, even as debates over their stability persist. The outcome may hinge on whether Bitcoin’s recent performance outweighs its history of sharp price swings—a gamble no major central bank has yet embraced.

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Isai Alexei
Isai Alexei
As a content creator, Isai Alexei holds a degree in Marketing, providing a solid foundation for the exploration of technology and finance. Isai's journey into the crypto space began during academic years, where the transformative potential of blockchain technology was initially grasped. Intrigued, Isai delved deeper, ultimately making the inaugural cryptocurrency investment in Bitcoin. Witnessing the evolution of the crypto landscape has been both exciting and educational. Ethereum, with its smart contract capabilities, stands out as Isai's favorite, reflecting a genuine enthusiasm for cutting-edge web3 technologies. Business Email: [email protected] Phone: +49 160 92211628
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