Czech National Bank May Become the First European Central Bank to Invest in Bitcoin

CNB Governor Aleš Michl is set to present his Bitcoin investment proposal to the bank's board. If approved, the investment may amount to over $7.3 billion

The Czech National Bank (CNB) may become the first European central bank to invest in Bitcoin as part of its diversification strategy for the country’s foreign exchange reserves.

CNB Governor Aleš Michl is set to present his Bitcoin proposal to the bank’s board on Feb. 14, the Financial Times reported on Friday. If approved, the investment could see the CNB allocate a portion of its $146 billion in reserves to Bitcoin.

André Dragosch, head of research at Bitwise, highlighted the potential scale of the move in a Jan. 29 post on X, suggesting that the CNB’s total reserves could enable an investment of over $7.3 billion in Bitcoin.

The news comes three weeks after Michl told reporters that he was considering Bitcoin as a potential reserve asset and planned to buy “a few Bitcoin” for diversification.

As of Jan. 7, the bank said it was not considering a Bitcoin investment, Janis Aliapulios, an adviser to the board, told Cointelegraph, adding that the bank planned to increase its gold holdings to 5% of its total assets by 2028.

Michl’s proposal follows a recent shift in the Trump administration’s stance on crypto regulation, which could pave the way for a more favorable regulatory environment for cryptocurrencies in the United States.

The administration’s more positive outlook on crypto regulation has sparked optimism among crypto investors, with some expecting the development to bolster Bitcoin’s momentum in 2025.

CNB Governor Michl also shared his thoughts on Bitcoin’s future prospects with the FT, suggesting that the cryptocurrency could reach a “local top” above $110,000 in January.

However, the Trump administration’s crypto regulation is also expected to set the stage for a Bitcoin rally to $100,000 with a critical warning sign.

Due to the rising inflation and interest rates in the United States, which could affect the liquidity of crypto markets, impacting Bitcoin's price.

According to Global Macro Investor founder and CEO Raoul Pal, Bitcoin is expected to experience a “local top” above $110,000 in January, with an “interim peak in liquidity” that could lead to a deeper correction in H1 2025.

Pal shared his analysis in a Nov. 29 X post, highlighting the significance of the GMI Total Liquidity Index (RHS) in his assessment.

Despite the potential for a deeper correction, analysts remain optimistic in the long term for 2025, with Bitcoin price predictions ranging from $160,000 to above $180,000.