European Central Bank president: Bitcoin lacks reserve potential

European Central Bank President Christine Lagarde ruled out the idea of European banks holding bitcoin in treasuries this week, stating, “Bitcoins will not enter the reserves of any of the central banks of the General Council [of the European Central Bank].”

“I think there is a view around the table of the Governing Council, and most likely the General Council as well, that reserves have to be liquid, that reserves have to be secure, that they have to be safe, that they should not be plagued by the suspicion of money laundering or other criminal activities,” Lagarde explained.

Her dismissal of the idea came as the head of the Czech National Bank announced a proposal to invest up to 5% of its reserves in bitcoin this week — a move that reignited debates over Bitcoin’s role in national reserves.

Although the Czech Republic has been an EU member since 2004 , the country has long postponed plans to join the common currency, fearing it would lose control over its own monetary policy and interest rates. (Seventy percent of Czech citizens oppose adopting the euro.)

In response to this week’s events, Wyoming Senator Cynthia Lummis, who backs a national Bitcoin reserve in the U.S., highlighted the importance of acting quickly on a strategic Bitcoin reserve to secure a competitive advantage: "If you’re not first, you’re last,” Lummis said . “America must take decisive action to establish a strategic Bitcoin reserve and secure its place in the 21st century."

The Trump administration is assessing the potential benefits of a strategic bitcoin reserve, but has yet to formally announce plans to create one.

Last month, however, the Federal Reserve chair Jerome Powell underlined the central bank’s lack of interest in a future bitcoin reserve. "We're not allowed to own bitcoin," Powell explained.

However, there is growing discussion around the world about the utility of Bitcoin as a reserve asset. “The consideration of Bitcoin as a strategic reserve by countries like the Czech Republic, Germany, Poland, and the United States underscores a growing recognition of cryptocurrencies as valuable assets,” said James Toledano, COO at Unity Wallet. “Some would say they are all late to the party though, and probably should have been doing this a year ago in February 2024 when the price was close to $45,000. However, if the predictions of $200,000 are accurate for 2025, then now would be the time to pile in.”