Bank of Korea Rejects Bitcoin for Reserves, Citing High Volatility and Liquidity Concerns

South Korea’s central bank has ruled out adding bitcoin to its foreign exchange reserves, citing extreme price volatility and failure to meet liquidity and investment-grade standards. This stance follows U.S. President Donald Trump’s March 6 executive order promoting bitcoin stockpiling. The Bank of Korea, responding to a query from Rep. Cha Gyu-geun, emphasized that reserves must be immediately usable and denominated in convertible currencies with high credit ratings—criteria bitcoin does not meet. Bitcoin’s recent fluctuating prices reinforce concerns about its instability. The central bank’s caution aligns with major financial institutions, including the European Central Bank (ECB) and the Swiss National Bank.