The head of the Czech National Bank wants to plow billions of the country's reserves in the country in Bitcoin, a pioneering step that could make the first Western Central Bank known to carry encryption assets.
Governor Alice Michael told the Financial Times that he would submit a plan for the Council to invest in it Bitcoin As a way to diversify CNB reserves at a meeting on Thursday. He said that if the Board of Directors approves this, CNB may eventually retain up to 5 percent of the 140 billion euros in Bitcoin.
While admitting the “extreme volatility” of Bitcoin and a limited record, Michl highlighted the Bitcoin's broader investor's interest since I launched Bitcoin last year last year Exchange of money.
He also pointed to the pledges of US President Donald Trump to cancel executive restrictions and the increasing impact of executives in the coin on his administration. In an executive order last week, Trump Prepare a working group to evaluate the construction of a national digital asset stock.
“In order to diversify our origins, Bitcoin looks good,” Michael said in an interview. “These men (Trump) can now create some bubbles for Bitcoin, but I think the trend will be an increase without these men as well, because it is an alternative (investment) for more people.”
Jay Powell, Federal Reserve Chairman, Jay Powell, confirmed in December that the US Central Bank did not carry any Bitcoin because it was not on the list of assets that Congress allowed to buy. “We are not looking to change a law in the Federal Reserve,” Powell said at the time.
Central banks Traditionally stopped its reserves in conservative origins such as the American Treasury and other forms of high -class bonds. Some have shares in stocks, but none of them publicly venture into encryption.
Michel said he had a “completely different philosophy” about Bitcoin for his counterparts.
“Of course, if I compare my position with other bankers, I am the person who enters the forest, or the pioneer,” said Michael. “I used to run an investment box, so I am a typical investment banker, I would like to say, I love profitability.”
Among the central bankers who warned of the risks of investing in encrypted currencies, the governor of the Bindas Bank, Joachim Nagil, who compared this month Bitcoin with “digital lily”, referring to a speculative bubble in the seventeenth century and then collapsing in the price of lamps.
European Central Bank officials wrote last year 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 European bank official Benoit Cœuré had previously indicated Bitcoin Bassem. ” Finance.
El Salvador was a prominent supporter of encryption, making him a legal tender in 2021. The government owns 6,048 Bitcoin in its treasury, at a value of about $ 621 million, according to its National Office Bitcoin. But the Central American country has expanded the scope of encryption ambitions late last year to reach a financing agreement with the International Monetary Fund.
In addition, some central banks experience digital currencies, in part in response to the threat posed by encrypted currencies.
Michel said that more central banks could follow its progress during the next five years, just like many boxes and commercial banks that recently changed Tac and added Crypto to its governor. some Retirement boxes I started investing in encryption.
However, he added that investment can be value.
“You can have a large collection of results, and that Bitcoin will have a zero value or a very great value. But in our history, we also had some stocks like ENRON or the Wirecard payment company, so we have some experience in bad investments, so,, Yes, I am ready (for the potential collapse of Bitcoin).
“But I say that my goal is to diversify the wallet, so if Bitcoin is good (so), let us get it.”
If the Czech bank has kept 5 percent of its foreign reserves in Bitcoin over the past decade, its annual returns would have increased by 3.5 percentage points, but it would also double in fluctuations, according to CNB.
Michel said that any major investment by the Central Bank in the investment funds circulated in Bitcoin can in itself affect the price of the currency. “Five percent (of our origins) is a lot of money, even for Bitcoin market,” he said.
The reserves of 140 billion euros of the central bank are equivalent to about 45 percent of the GDP of the Czech Republic. CNB is already among the central banks because 22 percent of its portfolios are in stocks, and Michl wants to be half of that in US shares about three years ago, an increase of 30 percent currently.
He said: “We gradually buy and in very small steps because the prices of (American stocks) are the highest in history.”
The Czech Republic is one of the seven countries in the European Union that remained outside the eurozone, but in the speech of the new year to the head of the nation, I have been packed, the discussion was re -discussed by urging the euro. “It will certainly enhance our prosperity in the future if (salaries) have pushed European currency, just as they are in Germany,” he said.
However, Michael rejected this idea, saying that there was not enough rapprochement in prices or public support to abandon the Czech Corona in the foreseeable future.
“Our president is a military strategic expert and I am an economist,” Michael said, referring to the background of Pavel as a leader of NATO. “If you have political problems, it may be good to have the euro, but it seems that you have a good monetary policy sound for us to fight inflation.”
He added that it is “very likely” that his bank will reduce interest rates by 25 basis points next week from 4 percent, by resuming a course in the price cuts that started in December 2023.
Additional reports by Niko Asagari in London Clair Jones, Washington
