European Central Banks May Start Accumulating Bitcoin in 2025

According to blockchain expert Fiorenzo Manganiello, European central banks could begin accumulating Bitcoin as early as 2025. This prediction comes on the heels of the European Union’s rollout of the Markets in Crypto-Assets (MiCA) regulation, which aims to bring stability to the crypto market by introducing clear legal frameworks.

Regulatory Clarity and Institutional Investment

Manganiello, co-founder of LIAN Group and a professor at Geneva Business School, believes that MiCA’s regulatory clarity will encourage institutional investors to enter the market, reducing volatility and legitimizing Bitcoin as a financial asset. This shift could extend to central banks, which may begin holding Bitcoin as a hedge against traditional market instability.

“Frankly, Bitcoin is becoming too dominant to ignore, and this year, I think we’ll see some European central banks begin to build their reserves of the currency in a bid to diversify their holdings and strengthen their defences against traditional market volatility. There’s no doubt that the MiCA rules will breathe new life into the European crypto scene. Even the most traditional financial institutions, such as central banks, will be ushered on board.”

The Impact of MiCA

The European Union introduced the Markets in Crypto-Assets framework in 2024, establishing a cohesive regulatory framework for the crypto industry across its member states. This initiative began in April 2023, when the EU Parliament passed MiCA to address persistent challenges in the rapidly evolving crypto sector, such as:

  • Fraud
  • Market volatility
  • Inadequate investor protections

Before MiCA, crypto companies navigated a complex landscape of varying national regulations. While some nations fostered innovation, others imposed significant barriers. MiCA aims to replace this fragmented approach with a unified set of rules for all 27 EU countries.

A Major Shift in Bitcoin’s Role

If European central banks follow through on Manganiello’s prediction, it would signal a major shift in Bitcoin’s role within the global financial system. As Manganiello noted, “As MiCA reassures traditional investors, we’ll see not only institutions but even central banks considering Bitcoin.”

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