Rather than fearing Bitcoin, central banks should examine its underlying technology and economic implications, says Aleš Michl, governor of the Czech National Bank (CNB). Despite concerns about its volatility, he believes understanding Bitcoin could actually strengthen financial institutions.
In a Feb. 19 post on X, Michl emphasized that Bitcoin should not be grouped together with other cryptocurrencies and deserves independent study.
“We, as central bankers, must analyze it and explore the technology behind it. Studying Bitcoin won’t harm us—if anything, it will make us stronger,” he stated.
His remarks follow a Jan. 30 CNB board meeting, where he proposed establishing a Bitcoin “test portfolio” to better understand the asset.
“This move is driven by the need to learn and experiment with this high-risk alternative asset,” Michl explained, noting that they are still in the early stages of analysis, and any final decision will depend on the findings.
Michl first considered Bitcoin as a potential reserve asset on Jan. 7, even discussing the possibility of acquiring a small amount for diversification, according to reports.
Czech National Bank Weighs $7 Billion Bitcoin Investment
Should the CNB approve Michl’s proposal, it could become the first European central bank to invest in Bitcoin. The potential investment may exceed $7.3 billion, given the CNB’s reserves of over $146 billion, according to André Dragosch, head of research at Bitwise.
In a Jan. 29 X post, Dragosch highlighted the scale of such an investment, stating:
“To put this in context, these Bitcoin purchases would equate to around 5.3 months of newly mined supply.”
While Bitcoin’s 130% annual returns in 2024 make it a compelling asset, Michl stressed that the CNB will require thorough analysis before making any major decisions.
Meanwhile, Bitcoin continues to face market pressures due to geopolitical tensions, particularly the ongoing trade dispute between the US and China. Vugar Usi Zade, COO of Bitget, noted that despite these challenges, Bitcoin has shown resilience.
“With President Trump considering additional tariffs in the coming weeks, Bitcoin remains under pressure, yet continues to trade with strength,” Zade observed.
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