Czech National Bank Explores Expanding Investment Portfolio, Taking Cues From Norway's Bitcoin Exposure

The CNB's Bank Board, during its Thursday meeting, approved an analysis into broadening its international reserves.

The Czech National Bank is exploring expanding its investment portfolio as global institutions, like the Norwegian sovereign wealth fund, show increasing exposure to assets like Bitcoin.

What Happened: The CNB’s Bank Board on Thursday approved an analysis into broadening its international reserves.

The decision follows two years of increasing diversification efforts and was brought on by a proposal from Governor Aleš Michl.

The aim is to assess the viability and benefits of incorporating new asset classes into their reserves, considering diversification and returns.

The analysis is underway and no immediate changes are anticipated. Once completed, the Bank Board will decide on any further actions.

Also Read: ‘Bitcoin Will Not Be Considered For Central Bank Reserves,’ ECB President Christine Lagarde Says

Why It Matters: This move by the Czech central bank mirrors a broader trend of institutional funds subtly embracing assets like Bitcoin.

Notably, the Norwegian sovereign wealth fund (NBIM) has also seen significant growth in its Bitcoin holdings, albeit indirectly.

According to Vetle Lunde, Head of Research at K33, the NBIM now holds 3,821 BTC.

This signifies a substantial increase of 1,375 BTC since June 30, 2024, and a 2,314 BTC jump year-on-year.

Its BTC holdings have grown by 153% compared to the end of 2023, underscoring the rapid maturation of Bitcoin as an investment asset.

Lunde clarified that the NBIM’s Bitcoin exposure isn’t a result of a deliberate direct purchase.

It is rather an outcome of rule-based sector weighting, where companies that have exposure to Bitcoin have grown in value.

Lunde added that increased NBIM holdings in companies like Riot Platforms RIOT and Metaplanet highlight this indirect trend.

He further noted that the per capita indirect exposure to Bitcoin in Norway via the NBIM translates to 68,837 sats (approximately $64) per person by the end of 2024.

The financial impact of the NBIM’s indirect Bitcoin exposure has skyrocketed from $23 million in 2020 to a substantial $356 million in 2024.

This comes as Bitcoin’s growth is reaching more of the traditional institutions through sector weighted strategies, whether intentionally or not.

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