XPR

Czech central bank officials express "doubt" about Bitcoin as a reserve asset

ChainCatcher news, according to a report by Reuters, Jan Kubicek, a member of the Czech National Bank (CNB) board, holds a "skeptical attitude" towards incorporating Bitcoin into the bank's large reserve assets, primarily due to concerns about its legal uncertainty and the volatility of digital currencies. Earlier this year, CNB Governor Ales Michl proposed considering Bitcoin, and the bank has begun analyzing the possibility of expanding the asset classes in its reserve investment portfolio. However, CNB Vice Governor Eva Zamrazilova has stated that Bitcoin is not a suitable reserve asset.In an interview on Tuesday, Kubicek stated, "We will evaluate different categories of assets, and Bitcoin is just one of them. I have a fairly skeptical attitude towards Bitcoin." He pointed out that the legal status of Bitcoin is an issue, as directly holding Bitcoin would mean developing many new processes in areas such as accounting or auditing. He also mentioned that volatility is another concern, making it difficult to assess market price trends. He said, "We cannot be sure whether the volatility of Bitcoin in the coming years will resemble the patterns observed in the past decade, because I doubt that if more institutional investors accept Bitcoin as an investment asset, its performance will be different from what we have seen so far."Kubicek indicated that the bank's research on new asset classes may be completed before October, and this research could explore the possibility of holding international corporate bonds, as well as investing in more targeted stock indices (such as technology) and real estate investment funds.

Strategy's stock price fell more than 11% in early trading on Tuesday, as the market expressed concerns over potential forced liquidations of Bitcoin it may face

ChainCatcher news, reported by Decrypt, based on analysis from The Kobeissi Letter, although Strategy's stock price fell over 11% in early trading on Tuesday, raising concerns about potential forced liquidation due to Bitcoin, the likelihood of this scenario occurring is low due to structural safeguards.Strategy primarily raises funds through convertible bonds, such as the $2 billion zero-coupon bond maturing in 2030, with an initial conversion price of $433.43 per share, allowing it to obtain capital without immediately diluting shareholder equity. As of now, Strategy holds approximately 499,096 BTC, valued at about $4.44 billion, while its $8.2 billion debt is highly dependent on Bitcoin's performance.This week's significant correction in the crypto market has led to a $3.7 billion evaporation in the market value of Strategy's Bitcoin holdings. Although there is currently no immediate risk, Polymath co-founder Trevor Koverko pointed out that if the market remains sluggish for an extended period, Strategy's collateral requirements and refinancing capabilities will be tested.Additionally, Strategy co-founder and chairman Michael Saylor holds 46.8% of the voting rights, and analysts believe that shareholder resolutions are nearly impossible to pass without his consent, thereby reducing the likelihood of forced selling due to bankruptcy or shareholder resolutions. The Kobeissi Letter also noted that even if the BTC price drops 50% to $33,000, Strategy's assets would still exceed its debts by over 100%, meaning that unless a "black swan" event occurs, forced liquidation is unlikely before the debt matures (earliest in 2028).
ChainCatcher Building the Web3 world with innovators