Czech Finance Minister Zbyněk Stanjura has expressed concerns over the proposal by the central bank’s governor, Aleš Michl, to explore the possibility of investing part of the country’s foreign exchange reserves into Bitcoin.

Although Stanjura acknowledges the independence of the Czech National Bank (ČNB) and the fact that the government cannot directly influence its decisions, he warned that Bitcoin’s extreme volatility makes it an unsuitable asset for reserve holdings.

ČNB Sees Bitcoin as a Diversification Strategy

The Finance Minister’s statement came in response to a recent proposal by ČNB Governor Aleš Michl, who suggested investing billions of euros from the central bank’s reserves into Bitcoin as part of a diversification strategy.

According to Michl, if the plan were approved, ČNB could eventually hold up to 5% of its €140 billion ($146 billion) in Bitcoin.

Since taking over as ČNB Governor in 2022, Michl has focused on expanding the institution’s investment portfolio, including gradually increasing gold holdings and allocating a larger share of reserves to stocks, which have the potential to generate stable long-term returns.

If this move were implemented, the Czech National Bank could become the first Western central bank to incorporate Bitcoin into its reserve assets.

Bitcoin Decision Still in Early Stages

In a post on social media platform X (formerly Twitter), Michl emphasized that no immediate decision is on the table. Instead, ČNB intends to thoroughly assess the feasibility and justification of such an investment.

He cited his existing approach to reserve diversification:

"The goal of the Czech National Bank is price stability. When we took office in July 2022, inflation was at 17.5%. We brought it to target. We are also diversifying reserves – gradually increasing gold holdings from 0% to approximately 5% and planning 30% in stocks."
Aleš Michl

Michl also pointed out that Bitcoin has no correlation with bonds, making it a potentially interesting addition to the reserve portfolio. However, he stressed that discussions are still in their early stages.

Czech Central Bank to Continue Bitcoin Evaluation Amid Global Skepticism

Regarding Bitcoin’s volatility, Michl acknowledged that it remains the primary obstacle to using digital assets as reserve holdings, despite their diversification advantages. He stated that on Thursday, the central bank’s team would conduct a detailed analysis of Bitcoin’s potential role in reserves, emphasizing that this is merely the first step.

Similar discussions are taking place in other countries. In Switzerland, crypto advocates have launched an initiative urging the Swiss National Bank (SNB) to hold Bitcoin and gold in its reserves. However, SNB has expressed skepticism about Bitcoin as a reserve asset.

The European Central Bank (ECB) has consistently rejected Bitcoin as a potential reserve asset, frequently comparing it to the Dutch tulip mania of the 17th century.

At a recent panel in Davos, the Governor of the South African Reserve Bank also dismissed the idea of holding Bitcoin in reserves, arguing that the crypto industry should not dictate what assets governments hold.


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