Lagarde’s comments were made despite the growing discussions on Bitcoin adoption around the world, and particularly in the US. Meanwhile, Norway’s sovereign wealth fund increased its indirect Bitcoin exposure, while El Salvador continues accumulating Bitcoin despite amending its laws to align with IMF conditions. Additionally, Grayscale launched a Bitcoin Miners ETF that gives investors indirect exposure to the mining sector.
European Central Bank Stands Firm Against Bitcoin in Reserve Strategies
Christine Lagarde, President of the European Central Bank (ECB), dismissed the possibility of Bitcoin (BTC) being included in central bank reserves as there is a need for liquidity, security, and safety in reserve assets. Her comments were made after Czech National Bank Governor Aleš Michl suggested the institution explore Bitcoin as part of its diversification strategy. However, the Czech central bank’s board did not explicitly mention Bitcoin in its plans.
Lagarde’s statement is one of the first clear rejections from the ECB regarding Bitcoin as a reserve asset, especially at a time of growing discussions around digital asset stockpiling. The comments also follow US President Donald Trump’s executive order to establish a working group for exploring regulations on a national digital asset reserve. At least one ECB member has advocated for exploring a digital euro in response to the Trump administration’s openness toward crypto.
The push for Bitcoin adoption as a reserve asset gained a lot of traction globally. This is particularly true in the United States, where lawmakers from states like Texas, Utah, Illinois, Wyoming, and Arizona introduced legislative proposals for Bitcoin stockpiling. These initiatives were inspired by the advocacy group Satoshi Action Fund, which championed the idea of Bitcoin as a financial hedge. Meanwhile, Coinbase CEO Brian Armstrong also urged global policymakers to consider BTC reserves as protection against inflation.
Christine Lagarde at the European Council
El Salvador is still the best example of a nation that is actively accumulating Bitcoin for its national reserves. The country’s approach has set a precedent, though many central banks are still a bit hesitant to follow suit.
Despite these discussions on Bitcoin as a reserve asset, its price has been rather volatile recently. At press time, BTC was trading hands at $104,203.66 after its price slipped by 0.36% over the past 24 hours.
Norway’s Sovereign Wealth Fund Expands Bitcoin Exposure
It has become very clear that not everyone necessarily agrees with Lagarde’s thoughts on Bitcoin. Norway’s sovereign wealth fund that is managed by Norges Bank Investment Management, recently increased its indirect exposure to Bitcoin through investments in crypto-friendly companies.
NBIM’s exposure to Bitcoin (Source: K33 Research)
According to K33 Research, the fund’s exposure to Bitcoin reached 3,821 BTC, which is valued at $356 million by the end of 2024. This is an annual increase of 153%. It seems like the exposure is attributed to rule-based sector weighting rather than a deliberate strategy to prioritize Bitcoin.
The sovereign wealth fund holds a $500 million stake in MicroStrategy, along with investments in crypto exchange Coinbase and Bitcoin mining companies like Mara Holdings and Riot Platforms. The Government Pension Fund Global, as it is officially known, reported record profits of $222 billion in 2024, which was its second consecutive year of impressive gains. The fund’s CEO, Nicolai Tangen, credited most of this success to large returns from the technology sector.
The increasing presence of publicly traded crypto companies and the launch of spot Bitcoin exchange-traded funds (ETFs) have made it much easier for institutions to gain both direct and indirect exposure to digital assets. In the United States, spot Bitcoin ETFs accumulated more than $124 billion in net assets in just their first year of trading. As regulatory frameworks become clearer, many analysts believe institutional adoption of Bitcoin will expand even more.
A pro-crypto policy shift in the United States is already influencing global markets as there is a very clear growing interest in digital assets seen in Europe and beyond. Swiss crypto bank Sygnum recently surveyed 400 institutional investors across 27 countries and found that 57% plan to increase their exposure to crypto assets. This suggests that institutional adoption of Bitcoin and other digital assets is likely to accelerate as financial markets grow and evolve.
Sygnum Bank survey key findings (Source: Sygnum)
El Salvador Amends Bitcoin Law to Meet IMF Terms
El Salvador’s Congress recently quickly approved legislation amending its Bitcoin laws to comply with terms set by the International Monetary Fund as part of a $1.4 billion loan agreement. The bill was passed just minutes after President Nayib Bukele sent it to the Legislative Assembly, securing 55 votes in favor and only two against. The amendment scales back the government’s Bitcoin involvement and makes its acceptance optional for businesses, unlike the previous legal requirement.
Ruling party lawmaker Elisa Rosales stated that the reform ensures Bitcoin’s permanence as legal tender while making its implementation a lot more practical. Despite the amendment and Lagarge’s recent comments, El Salvador continues to expand its Bitcoin holdings, and recently purchased an additional 11 BTC.
The country’s Bitcoin Office confirmed its plans to keep accumulating Bitcoin, which could intensify in 2025. El Salvador’s Bitcoin reserves currently stand at 6,049 BTC, which is valued at approximately $633 million, with an overall profit of 127% based on an average purchase price of $46,000 per Bitcoin.
Meanwhile, former US Senator Bob Menendez, who was a very vocal critic of El Salvador’s Bitcoin policy, was sentenced to 11 years in prison for accepting bribes in gold and cash. An FBI search of his home uncovered $480,000 in cash and gold bars worth an estimated $150,000.
Grayscale Launches Bitcoin Miners ETF
Grayscale also recently expanded its crypto investment offerings with the launch of the Grayscale Bitcoin Miners ETF (MNRS), which provides exposure to Bitcoin mining companies and the broader mining ecosystem. The fund was announced on Jan. 30, and it invests in firms listed in the Indxx Bitcoin Miners Index, which tracks companies primarily generating revenue from Bitcoin mining, mining-related hardware, software, and services. MNRS does not invest in digital assets directly or through derivatives but may have indirect exposure due to its holdings.
Grayscale believes in the fundamental role of Bitcoin miners in maintaining the security, integrity, and functionality of the Bitcoin network. The company pointed out that Bitcoin mining firms present an alternative for investors who may not have direct access to Bitcoin or prefer a different way to get some exposure to the market. According to David LaValle, Grayscale’s global head of ETFs, Bitcoin miners are positioned for huge growth as adoption increases, making MNRS a very attractive option for a broad range of investors.
MNRS details (Source: Grayscale)
The launch of the ETF happened as Bitcoin mining stocks have faced challenges despite Bitcoin’s 100+% gains in 2024. While Grayscale pointed to the correlation between Bitcoin’s price and mining companies, data from the Hashrate Index and Google Finance shows that most publicly traded mining firms struggled to capitalize on the rally. In fact, some stocks saw declines of up to 84%. However, the downturn in mining stocks in late January followed a broader market drop linked to the frenzy surrounding DeepSeek’s new AI model.
Despite recent challenges, Grayscale’s Bitcoin Miners ETF is part of the continued push to expand investment options in the crypto sector to offer investors a structured and rules-based way to gain exposure to the mining industry.
