Czech National Bank (CNB) Governor Aleš Michl has urged central bankers to study Bitcoin, emphasizing that it should not be grouped with other digital assets.
Michl, in a post on X dated February 19, stated that the central banks need to examine Bitcoin’s technology and not dismiss it along with other digital assets.
According to him studying Bitcoin won’t weaken central bankers, it would strengthen them as it provides a greater understanding of the potential impact that Bitcoin could have on monetary systems.
He compared the current state of the crypto market to the Czech Republic’s transition from socialism to capitalism in the 1990s. Many investment funds appeared during this period but most collapsed because of changes in the market.
Michl is convinced that investors will need to be educated about the risks and benefits of investing in crypto. He stated:
“Bitcoin, however, is a different story. It should not be lumped together with other crypto assets. We central bankers should study it and explore the technology it is built on. Studying bitcoin won’t harm us—on the contrary, it will strengthen us.”
Sein remarks coincide with reports that suggest the European Central Bank may reconsider its stance regarding national banks holding Bitcoins in their reserve.
Bitcoin Reserve Proposal
In the X post, Michl also provided an update about the Czech National Bank’s ongoing evaluation of expanding its investment portfolio to include Bitcoin.
According to him, the CNB’s board has approved a proposal to analyze Bitcoin investment options. He did clarify that the board’s approval does not mean adoption immediately. Before making any final decisions, the board will make a comprehensive assessment.
The statement was made by:
“The Bank Board approved a proposal to analyse the options for investing in additional asset classes. Based on the results of the analysis, the Bank Board will then decide how to proceed further. No changes will be implemented in this area until then.”
Michl also emphasized the fact that he informed CNB’s board of directors that
“Bitcoin is highly volatile and could one day be worth one of two extremes – either zero or a huge amount. I also stressed that bitcoin is a high-risk asset for professional investors who are aware of all the risks.”
He still wants the top bank to investigate Bitcoin, as part of its broader strategy for diversifying reserves.
Michl noted:
“This step is motivated by a desire to learn about and try out this highly risky alternative asset. I emphasised the need to adapt to changing conditions in the financial markets and to explore new reserve management options.”
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Oluwapelumi Adejumo
Oluwapelumi is a believer in Bitcoin. He gives insights into a variety of topics, including DeFi hacks, culture and mining, while highlighting its transformative potential.
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