Hold onto your digital hats, folks! The Bank of Korea has spoken, and it’s throwing a bit of cold water on the idea of stashing Bitcoin in its foreign exchange reserves. While the United States seems to be eyeing a digital treasure trove, South Korea is not jumping on that bandwagon just yet.
According to the buzz from Korea Economic Daily, the central powerhouse, The Bank of Korea, is keeping its distance from the crypto craze when it comes to its foreign exchange reserves. They made their stance crystal clear in a response to a written inquiry from Representative Cha Gyu-Geun – think of it as a digital pen pal exchange with the government.
Why the chilly reception, you ask? Well, volatility is the name of the game, and Bitcoin's wild price swings are enough to give any central banker a headache. Just imagine watching your reserves bounce around like a yo-yo! The bank pointed out that Bitcoin’s recent rollercoaster ride saw its value dip from a sky-high $109,000 to a much lower $76,700, and then settle at $83,500. Who needs that kind of stress?
Besides the heart-racing volatility, the Bank of Korea also highlighted that Bitcoin doesn’t make the grade according to the International Monetary Fund's (IMF) standards for foreign exchange reserves. They want their reserves to be as reliable as your grandma’s cookie recipe – stable, liquid, and convertible. Bitcoin, unfortunately, doesn’t tick all those boxes.
The word on the street is that some countries like the Czech Republic and Brazil are giving Bitcoin the thumbs up, but heavy hitters like the European Central Bank, the Swiss National Bank, and Japan are not so keen.
This comes amid a growing chorus from South Korean financial gurus and Democratic Party lawmakers who are pushing for a Bitcoin reserve, especially as the U.S. rolls out its own digital asset stash. But for now, South Korea's keeping its reserves old school, leaving Bitcoin to ride its own rollercoaster without them.
