Czech finance minister rejects $7B Bitcoin reserve proposal

The Czech National Bank (CNB) is exploring new asset classes for its reserves but has decided to exclude Bitcoin (CRYPTO:BTC), citing concerns over its volatility.

On January 30, 2025, Finance Minister Zbynek Stanjura addressed a proposal by CNB Governor Aleš Michl to allocate up to 5% of the central bank's $7 billion reserves into Bitcoin.

“The central bank should symbolise stability. If you look at Bitcoin trading, it’s definitely not a stable asset,” Stanjura stated, expressing scepticism about the idea.

At the CNB board meeting, the proposal to include Bitcoin was discussed but did not gain approval.

Instead, the bank announced plans to evaluate other asset classes for potential diversification and yield opportunities.

Governor Michl acknowledged Bitcoin’s volatility as a key challenge, explaining that its unpredictable price movements make it difficult to integrate into the central bank's reserve strategy.

He emphasised that further analysis is necessary before any decisions are made.

Despite the rejection of Bitcoin, some industry figures in the Czech Republic have welcomed the broader discussion on diversifying reserves.

Lucien Bourdon, an analyst at Trezor, noted that the Czech Republic has been at the forefront of Bitcoin-related innovations and said this proposal reflects growing interest in digital assets.

However, critics argue that Bitcoin’s instability makes it unsuitable for central banks aiming to maintain financial stability.

The CNB's decision aligns with similar hesitations expressed by other global financial institutions regarding cryptocurrency adoption in official reserves.

At the time of reporting, the Bitcoin (BTC) price was $104,760.