CNB's Historic Bitcoin Bet: $7.3 Billion Investment Looms

The Czech National Bank (CNB) is set to make a historic move by potentially becoming the first European central bank to invest in Bitcoin. Governor Aleš Michl is proposing an investment of up to 5% of the CNB's $146 billion reserves into Bitcoin, which could amount to a staggering $7.3 billion. If approved at the board meeting on Jan. 30, this move would significantly diversify the country's foreign exchange assets.

The potential purchase is no small matter. According to André Dragosch, head of research at Bitwise, such an acquisition would be equivalent to about 5.3 months of newly mined Bitcoin. This could add serious buying pressure to an already scarce supply, potentially fueling Bitcoin's price further.

Bitcoin's momentum isn't just about central bank adoption. The Trump administration's stance on crypto regulation is injecting further optimism into the market. Michl told Financial Times, "Those [Trump] guys can now kind of create some bubble for Bitcoin, but I think the trend would be an increase without those guys as well."

Despite short-term volatility, analysts remain bullish. Raoul Pal, CEO of Global Macro Investor, predicts Bitcoin will hit a "local top" above $110,000 in January before a correction. Looking further ahead, projections for 2025 range from $160,000 to $180,000, reinforcing Bitcoin's role as a serious asset in global finance.