Aleshmik, head of the Czech National Bank (CNB), who proposed exploring Bitcoin Reserve Options, was named “Governor of the Year” by the Central Banking Journal. The magazine praised its role in taming inflation and highlighted its efforts to diversify CNB’s portfolio, including considering investments in cryptocurrency as a reserve asset.
Michl took over as CNB governor in July 2022 and has since proven himself with anything but the traditional manager of the financial authorities. He is not afraid to differ from his peers and colleagues, and his unconventional approach to stabilizing prices while maintaining a strong domestic currency was recognized by him.
CNB’s AlešMichl is believed to have defeated Czech inflation
When former investing banker Misil took the helm of the CNB, the Czech Republic won one of Europe’s highest inflation rates over 17%. Under his unorthodox leadership, the bank had cut it to 2% by February 2024 within the two years he had promised.
The bank’s board of directors ignored some of the CNB’s own model, and decided to raise the base rate increase to 11% to prevent a rise in inflation expectations and instead keep it at 7% at that time, pointing to a decline in domestic demand and lower household savings.
Rather than maintaining a well-limited key rate for longer and then increasing it significantly and then reducing it immediately, it sent a signal to Czech companies that they could rely on stable interest rates.
Policy insight into a small, open economy like Czech officials: higher inflation after a shock does not always indicate the need for overheating or immediate rate hikes. It may simply reflect that it starts at a low price level. In other words, the interest rate should be higher…
-ALEšMICHL (@michliq_) March 22, 2025
Michl and his team also implemented a “strong Koruna policy,” designed to strengthen the Fiat of the nation by selling partial revenue generated from international reserves. By the end of 2023, CNB had sold 1.2 billion euros ($1.3 billion). This is detailed in the article.
A strong Koruna strategy reduced import costs and helped Prague to further maintain the country’s prices. The Czech National Bank had established that it mainly deals with “import inflation” due to the high cost of importing energy and other such.
“Governor of the Year” wants to try out Bitcoin Reserve
In addition to inflation and monetary policy, AlešMichl also demonstrated flexibility in central bank assets. Under his surveillance, CNB has significantly increased its gold share in its 14 billion euros of foreign exchange reserve to 8-46 tonnes, almost doubled its holdings with the goal of diversifying and increasing returns.
Michl then presented the proposal to “analyze the possibility of creating a Bitcoin test portfolio” accepted by CNB board members at the end of J Anuary. “This step is motivated by a desire to learn and try out this extremely dangerous alternative asset,” he told the magazine.
Bitcoin Update:
I’ll start widely: if you’re going to invest in crypto assets, take extreme care. The market is still in its early stages. I remember the 1990s in our country. The transition from socialism to capitalism saw many births and simultaneous collapse… https://t.co/uxgf0r7nwo-AlešMichl (@michliq_) February 19, 2025
The announcement that CNB might consider putting 7 billion euros into Bitcoin was not enthused by his old continental colleagues and co-workers on the banks. Some expressed their usual concern that cryptocurrencies are being used to promote illegal activities, and expressed that it requires a lot of energy to mine and is not actually a currency.
Chairman of European Central Bank (ECB) Christine Lagarde said she is confident that “bitcoin will not enter” the central bank reserves of the ECB’s General Council after she had what she called “good conversations” with Michl. And this week, CNB board member Jan Kubicek said he was “skeptical” about adding Bitcoin to the bank’s reserves.
“Governor of the Year” eventually acknowledged that Bitcoin Holdings deserves “zero or huge amounts” due to the volatility of cryptocurrency prices. He determined how the CNB Committee would proceed based on the results of the proposed analysis, ensuring that “until then no changes will be made in this area.”
The central bank award will be awarded for the first time to the Czech Republic, Daily Hospodasuke Novigny said in his report. Previous owners of the famous title include former ECB President Mario Draghi and former Bank of England Governor Mark Carney. Earlier this year, Alesh Missur was named European Governor of the Year by Banker, another industry magazine owned by the Financial Times.
