Bitcoin in the ČNB's reserves: what Governor Michl proposed and what it means
At the end of January 2025, the Governor of the Czech National Bank, Aleš Michl, proposed that the ČNB consider buying bitcoin for its foreign exchange reserves – in his words, up to 5% of the reserves. The proposal was made in an interview with the Financial Times. As of the date of this article, the ČNB had not decided on actually buying bitcoin. If it did, the ČNB would be the first central bank in the West to hold bitcoin in its reserves.
What figures are being discussed
| Item | Value according to available information (February 2025) |
|---|---|
| Proposed share of bitcoin | up to 5% of reserves |
| Corresponding amount | almost CZK 200 bn |
| Amount of bitcoin at the then market price | more than 70,000 BTC |
For comparison: the total number of bitcoins is firmly capped at 21 million. We explain how this limit arises and why new supply is reduced every four years in our article on the halving.
Why the Governor came up with it
Michl justifies the proposal with diversification. In his view, bitcoin has a low correlation with stocks, bonds and gold, so a small share could reduce the portfolio's overall risk. At the same time, it is the asset with the highest appreciation over the past decade – and also some of the biggest price swings.
The European Central Bank takes the opposite view and regards bitcoin as a speculative asset with no intrinsic value. The ČNB is not part of the Eurosystem and decides on the composition of its reserves itself.
Arguments for and against
| For | Against |
|---|---|
| Low correlation with traditional assets | High volatility – drops of tens of per cent within months |
| Firmly limited supply of 21 million BTC | No yield (interest, dividends) |
| Growing institutional interest (ETFs, companies) | Reputational and regulatory risk, the ECB's differing stance |
| Possible advantage of buying early | The question of secure custody and accounting treatment |
How other countries handle it
In 2021, El Salvador became the first country to make bitcoin legal tender. Hong Kong and the United Arab Emirates did not adopt bitcoin as legal tender – but they did create a regulatory framework that attracts crypto companies.
As of the date of the proposal, central banks of advanced economies did not hold bitcoin in their reserves. The ČNB proposal therefore attracted attention abroad too.
What it means for the Czech Republic
For now, this is a proposal and an analysis, not a decision. It has no direct impact on ordinary bitcoin holders or miners in the Czech Republic – taxation and rules remain the same. You will find an overview of what applies to mining and cryptocurrencies in the Czech Republic in our article on mining laws and taxes.
Addendum: developments after this article was published
The ČNB later launched the Digital Assets Pilot project within its innovation platform ČNB Lab, focused on gaining practical experience with digital assets. You will find up-to-date information directly on the ČNB website.
What next
- What is Bitcoin – how it works and why its supply is limited.
- Guide to the world of cryptocurrencies – market cycles, risks and media narratives.
Sources
Frequently asked questions
Has the Czech National Bank bought bitcoin for its reserves?
How much bitcoin would the CNB buy with 5% of its reserves?
Will the CNB proposal affect how bitcoin is taxed in the Czech Republic?
This text was prepared with the help of AI. Facts, figures and procedures were checked by Yegor.
