Bank of Korea Rejects Bitcoin for Reserves, Cites Market Volatility

South Korea’s central bank, the Bank of Korea (BOK), has dismissed the possibility of adding Bitcoin to its foreign exchange reserves, citing concerns over extreme price fluctuations and regulatory benchmarks.

During a recent National Assembly Strategy and Finance Committee session, the BOK confirmed that it has never considered holding BTC in its reserves. The central bank highlighted Bitcoin’s notorious volatility as a major deterrent, emphasizing that rapid price swings could lead to substantial transaction costs when converting crypto into fiat.

Additionally, the BOK pointed to Bitcoin’s failure to align with the International Monetary Fund’s (IMF) reserve management guidelines. The IMF prioritizes liquidity and risk mitigation, areas where Bitcoin falls short due to its unpredictable nature.

Despite South Korea’s vibrant cryptocurrency industry—with local exchanges processing billions in daily transactions—the central bank remains cautious about integrating digital assets into its official reserves.

As of the latest trading session in Asia, Bitcoin is hovering around $83,400, reflecting a 1% decline over the past 24 hours.