Countries around the world are now exploring the possibility of investing in Bitcoin as part of their national reserves. The newly elected U.S. President, Donald Trump, signed an executive order last week directing the United States to take steps to promote the development of digital currencies domestically and to establish a special fund to manage the U.S. digital currency assets.

Meanwhile, the governor of the Czech Republic’s central bank announced plans this week to invest in Bitcoin, amounting to approximately 5% of the bank’s reserves. Switzerland also recently announced that it is considering investing in Bitcoin, and the matter may potentially be put to a national referendum. In Russia’s parliament, a proposal was recently introduced to explore adding Bitcoin to the nation’s reserves, and similar proposals have emerged within the administrations of Hong Kong, Brazil, Poland, Germany, and Japan, among others. El Salvador and Bhutan have already defined Bitcoin as part of their reserves.

It is clear that many countries now view Bitcoin as a credible investment option for their reserves, and it is worth examining the underlying rationale.

Bitcoin has emerged as a new option, sometimes referred to as "digital gold," and is considered by many to be an important asset for hedging against systemic vulnerabilities in the current financial system.

Why Bitcoin?

The global economy is undergoing significant transformation. High interest rates, increasing national debts, rising inflationary pressures, and growing competition among major powers are reshaping the international economic landscape. The U.S. dollar has played a central role in the global financial system for decades, serving as the foundation of financial markets and international trade. However, this may be changing.

One of the main reasons for this shift is the growing tension among major powers. After the U.S. and Europe blocked Russia’s access to dollar and euro assets following the invasion of Ukraine, many countries have reassessed their approach to the types of assets they want to hold in their reserves. In response, several countries have made significant gold purchases, with China leading the way.

Growing concerns about unsustainable debt accumulation and fiscal deficits have also raised doubts about whether the purchasing power of many traditional currencies and government bonds will withstand the test of time. An example of this can be found in the history of the British Empire, which was left with substantial debts after World War I and decades of fiscal deficits. Holders of British government bonds experienced significant negative real returns as the purchasing power of the pound declined well into the latter half of the last century.

With increasing gold purchases by nations, there has also been growing interest in whether digital assets like Bitcoin can play a similar role in a changing economic environment. Bitcoin has emerged as a new option, often referred to as “digital gold,” and is seen by many as a critical asset to hedge against systemic vulnerabilities in the current financial system. Importantly, Bitcoin is not a national currency but a digital asset backed by a global network of computers, making the Bitcoin network the most secure computer system in the world. The system is entirely independent of individual nations, has a defined issuance schedule, and cannot have its supply increased beyond a predetermined amount.

The United States faces the challenge of how best to secure its economic and geopolitical position in an increasingly competitive world. Many forward-thinking economists see the potential for a renewed international monetary system, dubbed “Bretton Woods 3.0,” where traditional securities continue to hold weight alongside gold, but Bitcoin and digital assets also emerge as key pillars.

Larry Fink, CEO of the world’s largest asset management firm, BlackRock, said at the Davos economic forum in January that based on conversations with investors today, it is clear that interest in Bitcoin is growing significantly—especially as fears of declining purchasing power of traditional currencies or further political instability rise. Bitcoin could then serve as a global asset providing protection against such factors.

Here, we see current national holdings of Bitcoin potentially growing rapidly in the coming years

What Happens Next?
Developments in this area have been extremely rapid in recent months. It is likely that the shift in the U.S. stance toward digital currencies will play a significant role, as interest in the digital currency space among U.S. authorities was limited during Joe Biden’s presidency. Now, different picture is emerging. The U.S. has appointed a special task force to develop a comprehensive regulatory framework for digital currencies, and concurrently, countries around the world seem to be competing to follow the U.S. lead in these matters.

As outlined above, the year 2025 begins with momentum, and it is safe to assume that more countries will follow the trend described here. We are truly living in a time of significant change—and if current trends continue, Bitcoin appears to be becoming a new pillar in national reserves.

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