Central Banks and Crypto: A Cautious Dance Amidst Shifting Sands

While recent media coverage might suggest a growing embrace of cryptocurrencies by central banks, a deeper dive into a recent Central Banking survey reveals a more nuanced and largely hesitant approach. The survey, which polled 91 central banks managing over $7 trillion in reserves, paints a picture of cautious scepticism, particularly regarding Bitcoin and other digital assets.  

Diverging Perceptions: Media vs. Reality:

Last year's survey indicated that 15.9% of central bank respondents were open to considering investments in digital assets or currencies within a five- to ten-year timeframe. However, the 2025 survey presents a stark contrast, with a mere 2.1% expressing similar interest in cryptocurrencies over the same period. This significant drop highlights a growing divergence between media narratives and actual central bank sentiment.  

Current Stance: Zero Crypto Holdings:

Notably, not a single one of the surveyed central banks currently holds digital assets within their reserves. This conservative stance underscores the prevailing perception that cryptocurrencies, particularly Bitcoin, are not yet considered a suitable investment class by these institutions.  

Uncertainty and Evolving Credibility:

While outright rejection of Bitcoin as an investment is prevalent, a significant degree of uncertainty persists. 23% of central banks remain unsure about Bitcoin's suitability, and 11.6% acknowledge that cryptocurrencies are gaining credibility as an investment option.  

Strategic Bitcoin Reserve: Limited Support:

The concept of a strategic Bitcoin reserve garnered minimal support, despite being recently floated by some political figures. Only one central bank expressed enthusiasm for the idea, while a substantial 59.5% outright rejected it. However, a noteworthy 39.3% remained undecided, suggesting a potential for shifting opinions.  

Traditional Safe Havens Prevail:

In contrast to the lukewarm reception of cryptocurrencies, traditional safe-haven assets, particularly gold, continue to hold sway. 37.5% of surveyed central banks plan to increase their gold holdings in the coming year, with none intending to reduce their exposure. This preference for established assets underscores the enduring appeal of stability and predictability in reserve management.

Geopolitical Risks: US Protectionism Concerns:

Despite the survey's timing before the latest round of US tariffs, respondents identified US protectionist policies as the foremost risk to their reserves. This prescient concern highlights the growing influence of geopolitical factors on central bank decision-making.

Key Observations:

  • Central banks remain largely cautious regarding cryptocurrency investments.

  • Bitcoin is not currently considered a suitable investment class by most central banks.

  • Gold retains its position as a preferred safe-haven asset.  

  • Geopolitical risks, particularly US protectionist policies, are a major concern.  

Conclusion:

The Central Banking survey reveals a cautious and evolving landscape for cryptocurrency adoption by central banks. While media narratives may paint a picture of rapid integration, the reality is one of measured scepticism. As the digital asset space matures and geopolitical uncertainties persist, central banks will likely continue to navigate this terrain with a blend of curiosity and prudence.

Disclaimer: Please note that the content provided herein is intended solely for the purpose of broadening general understanding and offering general information. It should not be construed as a substitute for professional consultation or advice. You are strongly encouraged to seek guidance from qualified experts in the fields of finance, investment, or other relevant areas, tailored to your specific circumstances and requirements. By engaging with this material, you acknowledge and agree to the terms of this disclaimer.

Defoes