The Czech central bank made its first purchase of crypto assets; how far away is a national Bitcoin reserve?

Author: PANews, Zen

Central banks have also started to enter the cryptocurrency market.

In November 2025, the Czech National Bank announced the purchase of a total of $1 million in crypto assets as a “digital asset experiment portfolio.” This marked the first time in history that the Czech central bank had directly purchased cryptocurrencies, and it was also the first such transaction among central banks worldwide.

Czech Central Bank pilots one million digital asset reserve portfolio

According to the Czech National Bank, Bitcoin constitutes the majority of the asset portfolio, supplemented by some stablecoins pegged to the US dollar and a tokenized bank deposit. All assets were purchased through regulated trading platforms. The central bank explicitly stated that this move is purely experimental, does not count towards official foreign exchange reserves, and is classified as intangible assets for accounting purposes.

This pilot investment represents only 0.0006% of the central bank's total assets and does not constitute any investment advice or official stance on crypto assets.

According to a statement from the Czech National Bank, the purpose of this pilot program is to gain practical experience in holding digital assets and to test the necessary processes.

To this end, the central bank team will conduct drills covering the entire process chain, from private key custody and multi-level approval to security mechanisms and anti-money laundering compliance, to ensure a comprehensive understanding of digital asset management. The entire investment will be segregated from the central bank's traditional reserves, and its scale will not be proactively expanded before the trial evaluation is completed.

According to the plan, the Czech National Bank will assess the project's effectiveness in two to three years before deciding on the next steps. During this period, the portfolio value will fluctuate with market volatility or small-scale trial transactions.

“As the central bank, we want to test this path,” said Aleš Michl, Governor of the Czech National Bank. He pointed out that new payment and investment methods are emerging one after another, and the central bank wants to be prepared in advance. He envisions a future where people can easily use Czech krona to buy assets such as tokenized government bonds, just as “one click can buy coffee, and another click can invest in assets that were once only accessible to large investors.”

The proposal for a national Bitcoin reserve faces significant obstacles.

In fact, shortly before the official launch of the pilot investment portfolio, the Czech Republic had already engaged in a discussion that attracted widespread attention regarding a "national Bitcoin reserve."

At the beginning of this year, Aleš Michl publicly stated that he would consider holding Bitcoin in foreign exchange reserves, with an initial plan to allocate up to 5% of the reserves to Bitcoin assets, worth as much as 7 billion euros. However, this proposal immediately sparked controversy and skepticism from various parties.

Opinions within the Czech Republic and its central bank are divided, with opposition primarily stemming from concerns about the high-risk nature of Bitcoin. Jan Kubicek, a member of the Czech Central Bank's board of directors, expressed "skepticism" about including Bitcoin in the bank's vast reserve assets, mainly due to concerns about legal uncertainties and the volatility of digital currencies. Czech Finance Minister Zbyněk Stanjura also publicly expressed concern, stating that while he respects the central bank's independence, the move is worrying. He warned that Bitcoin's price fluctuates wildly, and "central banks should symbolize stability, but Bitcoin is clearly not a stable asset."

Extending this stance to the European level, the European Central Bank (ECB) has explicitly expressed its opposition. ECB President Christine Lagarde poured cold water on the idea at a press conference in late January, stating that she had communicated with Michl and believed that EU member state central banks would not include Bitcoin in their reserves. Lagarde emphasized that central bank reserve assets should be "highly liquid, reliable, and secure," and did not believe that cryptocurrencies met these requirements. Although the Czech Republic is not in the Eurozone, its central bank is a member of the European Central Bank system, and this strong statement effectively flashes a red flag for the Czech Republic's Bitcoin reserve plan.

Under pressure from both internal and external sources, the Czech National Bank's board announced it had agreed to conduct an analysis and assessment of whether new asset classes, including Bitcoin, are suitable as reserves, but would not implement any changes in this regard until the study is complete. The central bank's official statement did not directly mention "Bitcoin," but only agreed in principle to assess broader reserve diversification options.

The proposal to establish a national Bitcoin reserve has been shelved, making its implementation unlikely in the short term. Even though there are officials in the Czech Republic, such as Aleš Michl, who are willing to promote the inclusion of crypto assets in the reserve, pressure from the European Central Bank system and cautious voices within the government make it difficult for such a groundbreaking measure to be implemented quickly.

However, Michl's lobbying efforts did not cease, and he continued to champion Bitcoin. Amidst the numerous negative reviews surrounding the meme craze, Michl stated that the cryptocurrency market would experience "failures and successes," but that Bitcoin was significantly different from other crypto assets and should not be confused with cryptocurrencies.

The Czech central bank bought Coinbase shares, but it doesn't seem to care about its "crypto concept."

Since 2022, the Czech central bank has gradually increased the proportion of gold and stocks in its official reserves in order to seek more stable long-term returns, which is also one of the diversification strategies after Michl took office.

After its Bitcoin reserve plan fell through, the Czech central bank surprisingly allocated “crypto stocks” to its risk exposure. In the second quarter of this year, the Czech central bank made its first purchase of Coinbase Global, spending about $18 million to buy 51,732 shares at an average cost of around $350.

In the second quarter, Coinbase's stock price surged, soaring from a low of around $142 per share to above $350 by the end of June, far outpacing all major cryptocurrencies. During this period, the overall cryptocurrency market was still in a downturn, and the Ethereum reserve program for publicly traded companies was still in its infancy.

However, the Czech central bank's willingness to purchase Coinbase shares seems unrelated to its "cryptocurrency" attributes, and it has not conducted in-depth analysis or research on the matter. In its response to Barron's, while it did not comment on the purchase, it effectively revealed the underlying motivation—the Czech central bank stated that its passive index replication strategy remains unchanged.

In a blog post published in 2023, the Czech National Bank stated that it had repeatedly declared its investment approach as a "passive stock index replication." Its investments in the US market are linked to the S&P 500 index, and it strives to replicate the structure of the S&P 500 index to the greatest extent possible, accurately replicating the weights of individual stocks in the index.

Therefore, the Czech central bank's purchase of Coinbase shares is clearly entirely due to the company's historic achievement in May of this year, becoming the first cryptocurrency-native company to be included in the S&P 500 index.

Prudence and openness in Czech domestic regulation

At the regulatory policy level, the Czech Republic has demonstrated a cautiously open attitude towards the crypto industry in recent years. On the one hand, the government and central bank are keenly aware of the risks of crypto assets, emphasizing investor protection and preventing systemic risks; on the other hand, it is actively adapting to the unified EU regulatory framework and updating its national laws to support the compliant development of the crypto industry.

In late 2024, the Czech Parliament overwhelmingly passed the "Financial Markets Digitalization Act," which was subsequently signed into law by President Peter Pavel in February 2025. The act includes provisions such as tax exemption on capital gains from long-term cryptocurrency holdings by individuals, establishing an annual threshold of 100,000 Czech crowns (approximately US$4,100) for "small transactions without reporting," explicitly granting cryptocurrency businesses and investors the right to open bank accounts without discrimination, and incorporating the EU's Crypto Asset Markets Regulation (MiCA) into the Czech legal system.

Beyond regulatory rules, the Czech Republic has also taken steps to develop crypto infrastructure and foster the industry. The Central Bank's CNB Lab serves as a platform supporting fintech exploration, and this digital asset pilot portfolio originated from this innovation center. Simultaneously, the government supports industry organizations and think tanks in researching the potential of the crypto industry.

In specific regulatory practices, the Czech National Bank (CNB) and related institutions continue to adhere to a prudent approach. The CNB has repeatedly emphasized the high-risk nature of crypto assets. For example, when announcing the pilot portfolio, the central bank stressed that Bitcoin is highly volatile, with prices potentially surging or even plummeting to zero in extreme circumstances, and stated that this test portfolio does not represent any form of investment advice.

Furthermore, the Czech National Bank also pointed out that regulation cannot prevent all collapses and frauds, and some projects and funds may face difficulties or failure in the future. "Therefore, even if the provider has obtained permission from CNB or other European regulators, people should be aware of the risks associated with these assets."