According to the Czech Republic's central bank governor, Alex Michl, incorporating bitcoin into the institution's reserves could potentially enhance performance. However, he warned that the asset's volatility exceeds that of other assets, posing a significant risk. In a speech at the Bitcoin 2026 conference, Michl noted that bitcoin's price fluctuations are substantially higher than those of other assets, making it a risky investment. He emphasized that all assets carry the risk of losing their value, which is why diversification is crucial.
Michl shared his personal experience with bitcoin, recalling that his first purchase with the cryptocurrency was a coffee that would now cost around $350. While bitcoin has shown high returns over time, Michl believes it is too risky for investment.
The Czech National Bank created a $1 million test portfolio in November, which includes bitcoin, a USD stablecoin, and a tokenized deposit. The goal of this pilot was to gain hands-on experience with blockchain-based assets and explore their potential to redefine the country's payment and financial systems. A study by the CNB found that bitcoin has a low correlation with traditional assets, making it a potentially valuable addition to a portfolio.
However, the bank ultimately decided not to invest its foreign exchange reserves in bitcoin due to its high volatility.