By Sama Marwan,
The Bank of Korea (BOK) has urged caution regarding the idea of including Bitcoin in the country’s foreign exchange reserves, citing the cryptocurrency’s high price volatility.
According to Yonhap News Agency, unnamed officials revealed that South Korean lawmakers have been discussing the potential inclusion of cryptocurrencies in the country’s strategic foreign reserves. This debate follows U.S. President Donald Trump’s recent announcement about establishing a strategic Bitcoin reserve and a stockpile of digital assets earlier this month.
In response to a question from Representative Cha Gyu-geun of the Rebuilding Korea Party, the Bank of Korea stated that it has neither discussed nor reviewed the possibility of adding Bitcoin to its foreign exchange reserves and emphasized that caution is necessary.
The BOK highlighted Bitcoin’s extreme price fluctuations as a primary concern, stating:
“If the cryptocurrency market becomes unstable, Bitcoin exchange transaction costs could surge significantly.”
Additionally, the central bank noted that cryptocurrencies do not meet the International Monetary Fund (IMF) criteria for foreign exchange reserves, which include liquidity, market value, and credit rating standards.
