31 January 2025
The Czech National Bank (CNB) is considering adding Bitcoin to its national reserves, with Governor Aleš Michl proposing to allocate up to 5% of the country’s €140 billion reserves to the cryptocurrency. If approved, this move would make the CNB the first Western central bank to hold Bitcoin. Michl argues that Bitcoin could serve as a diversification tool amid growing global interest in crypto investments, particularly after the introduction of Bitcoin ETFs by major financial institutions like BlackRock.
The CNB board has yesterday approved an internal analysis to assess the potential risks and benefits of holding Bitcoin as part of its reserves. This analysis will inform the final decision, but no immediate changes will be made until the review is complete. While there’s no specific timeline, it’s reasonable to anticipate that the CNB’s analysis and subsequent decision-making process could take several months. Since the CNB board has the authority to decide on reserve composition, no legislative approval is required at this stage. However, if broader policy changes or additional oversight measures are deemed necessary, further regulatory discussions may follow. The outcome of this process will determine whether the Czech Republic takes a pioneering step in Bitcoin adoption at the central banking level.
Of course, not everyone is convinced. Critics argue that Bitcoin’s volatility makes it an unreliable reserve asset, with prices fluctuating dramatically over short periods. Czech Finance Minister Zbyněk Stanjura has warned that the central bank should prioritize stability, not speculation. But volatility alone does not disqualify an asset from being part of a diversified reserve—after all, the Czech National Bank already holds gold, foreign currencies, and bonds, all of which carry their own risks. Yes, Bitcoin is volatile, but so is the Euro when central banks print trillions. Bitcoin, despite its price swings, has been the best-performing asset of the last decade and is increasingly recognized as a hedge against excessive monetary expansion and inflation. The Eurozone’s ongoing struggles with debt and inflation only strengthen the argument for Bitcoin’s inclusion. By holding a small allocation of Bitcoin, Czechia is not betting recklessly—it is taking a calculated step to ensure financial resilience in an era of growing economic uncertainty.
Christine Lagarde recently dismissed the idea of Bitcoin becoming a reserve asset in the European Union, but here’s the key detail—Czechia is in the EU, but not in the Eurozone. Unlike countries that must follow the European Central Bank’s policies, Czechia has its own currency, the Czech koruna (CZK), and a fully independent central bank. This means the Czech National Bank is free to make its own monetary decisions, including adding Bitcoin to its reserves. While Brussels resists, Prague can lead.
For many, this proposal seems radical. But for those who understand Czechia’s past, it feels like the natural next step. My home country is a nation of DIY thinkers—people who know that if you don’t do it yourself, no one will. We have always had to figure out how to survive and keep our freedom because it has been taken from us so often. It just makes so much sense that Bitcoin resonates here. When you grow up listening to your grandfather’s stories at Christmas dinner—stories about how his land and house were seized by the communist regime, only to be neglected and ruined by state cooperatives—you understand. When you hear about your relatives fleeing abroad, leaving all their possessions behind, sewing the last of their inherited gold into their coats just to have a chance to survive in the West, you really get it. You want to have something that no one even knows you have—something no one can take from you.
Czechia’s innovation in Bitcoin is no coincidence. The world’s first Bitcoin mining pool (Slush Pool, now Braiins) was founded in Prague, along with the first-ever hardware wallet, Trezor. Recently, the government took a progressive step by eliminating capital gains tax for long-term Bitcoin holders, making it easier for citizens to build generational wealth. This doesn’t happen on its own—it’s the result of relentless work by Bitcoiners in Czechia, who are constantly pushing boundaries, educating not just individuals but also policymakers, politicians, and governors. Despite the ongoing debates on what constitutes a grassroots approach, in my opinion, there is no better example of a bottom-up strategy. We often complain that policies don’t make sense and are unfair, but what do we do to change them? We buckle up, explain, educate, and make clear what we want, what we will vote for, and where we draw the line.
This isn’t just about Bitcoin—it’s about securing our place in Europe and reaffirming our role in the Western world. The CNB’s proposal to hold Bitcoin as a reserve asset could cement Czechia’s reputation as a European leader in innovation—and, let’s be honest, finally give this small nation access to Bitcoin at the price it deserves. Unlike resource-rich nations that rely on oil or vast agricultural exports, Czechia has always depended on ingenuity, craftsmanship, and strategic thinking. We don’t have liquid gold under our feet, and we cannot ‘drill, baby, drill.’ We do not have vast, fertile lands. But we have our minds and our hands, and in this highly competitive race, that is how we will secure our future.
This article is a Take. Opinions expressed are entirely the author’s and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.