The Korean Bank says that it adopts a “prudent approach” to potentially include bitcoin as a exchange reserve.
Managers of the Korean central bank declared in a response of March 16 to a written survey that they had not examined a potential Bitcoin (BTC) reserve, citing great volatility.
Answering a question from the Cha Gyu-Geun representative of the planning and financing committee of the National Assembly, the central bankers said that they had “discussed or examined the possible inclusion of Bitcoin in exchange reserves, adding that” prudent approach is necessary “, according to Korea Herald.
“The volatility of Bitcoin prices is very high,” noted the central bank, before adding that “in the case of the instability of the cryptocurrency market, the transaction costs to withdraw bitcoins could increase considerably.”
In the past 30 days, Bitcoin prices have changed wildly between $ 98,000 and $ 76,000 before settling at current levels of around $ 83,000 in a 15% drop since February 16, according to Coingecko.
The decision comes in the midst of growing global discussions on the role of cryptographic assets in national financial strategies, triggered by the executive decree of US President Donald Trump earlier this month, establishing a strategic bitcoin reserve and a stock of digital assets.
During a seminar on March 6, lobbyists of the cryptographic industry and certain members of the Democratic Party of Korea urged the country to integrate bitcoin into its national reserves and to develop a stablecoin to support.
However, the Korean bank stressed that its exchange reserves must have liquidity and be immediately usable when necessary, as well as a credit note for the investment note or more, criteria that Bitcoin does not meet, in its opinion.
Professor Yang Jun-Seok of the Catholic University of Korea concluded, declaring: “It is appropriate that exchange is held in proportion to the currencies of the countries with which we exchange”,
Professor Kang Tae-SOO of the Graduate School of Finance KAUST commented that the United States was likely to take advantage of Stablecoins rather than BTC to maintain the hegemony of the dollar before adding, “if the IMF will recognize exchange reserves in the future.”
In relation: The Democratic legislator urges the Treasury to stop Trump’s Bitcoin reserve plans
Earlier this month, the financial regulator of South Korea examined the legislative trend of the Japanese financial agency towards cryptographic assets while it reflects on a ban on the funds negotiated in exchange for crypto in the country.
Review: ETH can lower at $ 1.6,000, sec delays several ETF Crypto, and more: Hodler’s Digest
