Bitcoin News: Cryptocurrencies made significant progress in the economy in 2020. According to a survey of central banks by UBS, they stated that they are skeptical when it comes to digital currencies and agree that they value gold as a safe haven. Will central banks buy Bitcoin?
Will central banks buy Bitcoin?
In UBS’s most recent annual central bank survey, nearly 85% of reserve managers of 30 respondents said they do not expect cryptocurrencies to replace gold held in foreign exchange reserves.
The survey also said that 57% of central banks do not expect digital currencies to have a significant impact on their reserve operations.
However, this does not mean that executives do not see value in Bitcoin and other cryptocurrencies.
More than 25% of respondents indicated that Bitcoin and other digital currencies have investment potential as uncorrelated assets that do not move with the market.
The debate over the development of Central Bank Digital Currencies (CBDCs) continues to grow as central banks are expected to soon become buyers of Bitcoin.
The survey said that more than 60% of reserve managers expect at least one central bank in the G7 to create a digital currency directly available to consumers within the next five years.
Also, more than 80% said they expect “wholesale” central bank money to be made available to major financial institutions within the next five years.
What is the view of central banks for Bitcoin?
In mid-April, the Bitcoin price reached an all-time high of $65,000. However, the price has since dropped 50% and is currently trading around $32,500.
Many analysts said that Bitcoin has struggled in recent months as the market is facing pressure as a result of its rapid development.
On the other hand, gold is expected to receive more support due to the increasing demand from central banks. According to a World Gold Council report released last month, 21% of central banks plan to increase their gold reserves by 2022 without changing their gold reserves over the next year.
The report also noted that no central bank expects to sell gold this year.