Pilot Program Includes Bitcoin, Stablecoins, and Tokenized Deposits
The Czech National Bank (CNB) has created a crypto portfolio valued at $1 million, marking its initial foray into purchasing Bitcoin, USD stablecoins, and a tokenized deposit. This initiative aims to provide the central bank with direct, hands-on experience with emerging technologies shaping global finance.
Governor Aleš Michl stated in an interview with Central Banking that the CNB is not engaging in simulations but rather seeking to "touch reality." The objective is to gain practical understanding of these technologies without the delay of catching up later.
The Bank Board formally approved this plan on October 30, following a review of an analysis on new asset classes. While the portion concerning cryptocurrency has been made public, the details regarding other investment types remain confidential.
Currently, the CNB has no plans to integrate any cryptocurrency into its official international reserves, nor have any decisions been made regarding the other asset classes examined in the analysis. This experimental endeavor is conducted entirely separate from the CNB's standard reserve management operations.
Comprehensive Testing of Crypto Operations
Governor Michl explained that the concept originated in January 2025 when he proposed testing Bitcoin's functionality from a central bank's viewpoint. This initial idea evolved into a broader project. Subsequent discussions within the CNB led to the expansion of the test plan to encompass USD stablecoins and tokenized deposits, recognizing their growing significance in modern financial systems.
He elaborated, "The aim was to test decentralised bitcoin from the central bank’s perspective and to evaluate its potential role in diversifying our reserves." The CNB intends to run this pilot program for a period of two to three years and will provide public updates throughout its duration.
The complete structure of the portfolio allows the CNB to meticulously compare the performance and operational aspects of each type of cryptocurrency. This includes evaluating methods for acquisition and storage, utilization in transactions, accounting procedures, and the verification processes required during audits.
The test also incorporates simulations for crisis scenarios, multi-stage approval workflows, key management protocols, security measures, and adherence to anti-money laundering regulations.
This cryptocurrency experiment will not impact foreign exchange interventions or monetary policy. The funding for this portfolio was sourced from the CNB's regular financial activities, distinct from the reserves used to support the Czech koruna.
Governor Michl emphasized that this is not a profit-driven initiative. "It is important to emphasise that the value of bitcoin may fluctuate substantially. No investor should buy bitcoin without being aware of the significant risks involved," he cautioned.
The total value of the portfolio will not exceed $1 million, although its actual market value may fluctuate during the testing phase due to Bitcoin's price movements and the progression of the experiment. This represents a one-time investment. The CNB has indicated that any price variations will not affect its overall financial standing, given the portfolio's modest size relative to the bank's total assets.
CNB Lab Explores Blockchain and AI Technologies
In parallel with the crypto portfolio initiative, the CNB has launched CNB Lab, a new innovation hub dedicated to experimenting with blockchain, artificial intelligence (AI) tools, and payment technologies. Governor Michl stated that the primary goal is to prepare for the transformative changes anticipated in the financial sector and monetary policy.
"The CNB Lab is intended as a platform to gather experience and insights from testing new technologies and trends. In addition to blockchain and digital assets, we will focus on AI tools and payment innovations," he explained.
The CNB Lab will focus on enhancing instant payment systems, testing tokenized assets, and exploring the potential for the koruna to be used in the future for purchasing tokenized Czech government bonds and other investments with the same ease as buying everyday items. Governor Michl expressed the CNB's commitment to facilitating such advancements.
"Let’s be more forward-thinking, more visionary. It is realistic to expect that, in the future, it will be easy to use the koruna to buy tokenised Czech bonds and more besides—with one tap an espresso; with another an investment such as a bond or another asset that used to be the preserve of larger investors," he remarked.
The bank will meticulously document all stages of its experimental processes, leveraging the acquired knowledge to build internal expertise. Staff members from various departments will have opportunities to share their findings and utilize these experiences to support future financial innovations.