{"id":561079,"date":"2026-09-08T23:20:14","date_gmt":"2026-09-08T22:20:14","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=561079"},"modified":"2026-09-09T16:27:52","modified_gmt":"2026-09-09T15:27:52","slug":"why-bitcoin-bulls-shouldnt-mistake-a-shrinking-dollar-reserve-share-for-central-bank-buying","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/why-bitcoin-bulls-shouldnt-mistake-a-shrinking-dollar-reserve-share-for-central-bank-buying\/","title":{"rendered":"Why Bitcoin bulls shouldn&#8217;t mistake a shrinking dollar reserve share for central bank buying"},"content":{"rendered":"<p>A Sept. 2, 2026 analysis by New York Fed researchers shows how a few large reserve portfolios can lower the global dollar share without a broad retreat from dollars. For investors assessing future sovereign demand for Bitcoin, the distinction is between a changing average and an investment decision.<\/p>\n<p>Linda S. Goldberg, Oliver Hannaoui and Sneha Parthasarathy report that the <a href=\"https:\/\/libertystreeteconomics.newyorkfed.org\/2026\/09\/are-central-banks-moving-out-of-dollar-assets\/\">dollar share of global official foreign-exchange reserves<\/a> fell from 64% at year-end 2015 to 56% at year-end 2025, using IMF COFER data.<\/p>\n<p>Their country-level evidence points to concentrated decisions and changes in reserve sizes.<\/p>\n<p>Countries can change the currency mix of their portfolios, the \u201cpreferences\u201d channel. Alternatively, their total reserves can grow or shrink, changing their weight in the global average.<\/p>\n<p>When a country with a below-average dollar allocation accumulates reserves, it can pull down the worldwide dollar share without cutting its own allocation. Switzerland did that between 2015 and 2019: its reserve growth pushed the aggregate share down even as its own dollar allocation rose.<\/p>\n<p>For that period, 76 countries had complete endpoint data within a 79-country exercise. Their preferences and reserve-size contributions declined by 1.2 and 1.5 percentage points, respectively.<\/p>\n<p>For 2019-2023, the <a href=\"https:\/\/libertystreeteconomics.newyorkfed.org\/2026\/09\/are-central-banks-moving-out-of-dollar-assets\/\">62 countries with complete data<\/a> contributed a positive 0.3 percentage point through preferences and a negative 0.5 percentage point through reserve-size changes.<\/p>\n<p>China, Russia, Mexico and Morocco lacked 2023 dollar-allocation data. Under assumptions matching the observed 2.3-percentage-point global decline, the researchers inferred a combined negative 2.0-percentage-point preferences contribution for that group.<\/p>\n<figure id=\"attachment_561087\" aria-describedby=\"caption-attachment-561087\" style=\"width: 720px\" class=\"wp-caption aligncenter\"><a href=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-686e9206-250a-439e-b377-c402e4e2b9cb.png\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-561087\" src=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-686e9206-250a-439e-b377-c402e4e2b9cb.png\" alt=\"2019\u20132023 reserve decomposition: 62 complete-data countries contributed +0.3 percentage point through preferences and \u22120.5 through reserve size. The missing China, Russia, Mexico and Morocco group has an inferred \u22122.0-point preferences contribution under assumptions matching the global decline. These figures do not measure Bitcoin purchases.\" width=\"720\" height=\"900\" srcset=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-686e9206-250a-439e-b377-c402e4e2b9cb.png 1122w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-686e9206-250a-439e-b377-c402e4e2b9cb-240x300.png 240w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-686e9206-250a-439e-b377-c402e4e2b9cb-819x1024.png 819w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-686e9206-250a-439e-b377-c402e4e2b9cb-768x960.png 768w\" sizes=\"(max-width: 720px) 100vw, 720px\" \/><\/a><figcaption id=\"caption-attachment-561087\" class=\"wp-caption-text\">Infographic shows 2023 dollar-reserve data missing four countries and explains that reserve-share statistics do not establish sovereign Bitcoin purchases.<\/figcaption><\/figure>\n<h2>A Bitcoin allocation needs its own evidence<\/h2>\n<p>The <a href=\"https:\/\/www.newyorkfed.org\/research\/staff_reports\/sr1087\">underlying Staff Report 1087<\/a>, issued in March 2024 and revised in February 2026, separates reserves needed for liquidity from an investment portion above those needs. Trade payments, foreign-currency debt, and currency stabilization sustain the need for liquid reserves.<\/p>\n<p>The paper <a href=\"https:\/\/www.newyorkfed.org\/medialibrary\/media\/research\/staff_reports\/sr1087.pdf\">models that investment portion<\/a> using short-term external debt or three months of imports as alternative measures of liquidity needs.<\/p>\n<p>Diversification is more prevalent when reserves can satisfy those needs. Its earlier decomposition covers 2015-2020, while its broader country panel spans 1999\u20132023.<\/p>\n\n<div class=\"cs-article-embed\">\n    <a href=\"https:\/\/cryptoslate.com\/arthur-hayes-calls-eur-jpy-prices-cryptos-smoke-alarm-but-the-feds-plumbing-still-shows-no-fire\/\" class=\"cs-article-embed__link\">\n        <div class=\"cs-article-embed__body\">\n            <span class=\"cs-article-embed__related-reading\">Related Reading<\/span>\n            <h3 class=\"cs-article-embed__title\">Arthur Hayes calls EUR\/JPY prices crypto\u2019s smoke alarm, but the Fed\u2019s plumbing still shows no fire<\/h3>\n        <\/div>\n        <span class=\"cs-article-embed__arrow\" aria-hidden=\"true\">\n            <i class=\"fa-light fa-arrow-up-right\"><\/i>\n        <\/span>\n    <\/a>\n<\/div>\n\n<p>The distinction also applies when a central bank actually <a href=\"https:\/\/cryptoslate.com\/coins\/bitcoin\/\">buys Bitcoin<\/a>. On Nov. 13, 2025, the <a href=\"https:\/\/www.cnb.cz\/en\/cnb-news\/press-releases\/The-CNB-creates-a-test-portfolio-of-digital-assets\/\">Czech National Bank announced<\/a> a $1 million digital-asset test portfolio including Bitcoin, with a dollar stablecoin and tokenized deposit also part of the project.<\/p>\n<p>The amount covered the whole portfolio, and the purchase was explicitly outside international reserves.<\/p>\n<p>Applied to Bitcoin, the reserve research supports a limited inference: diversification beyond liquidity needs does not identify the money's destination. Neither New York Fed source measures sovereign Bitcoin purchases or estimates a Bitcoin price effect.<\/p>\n<p>A sovereign Bitcoin demand case needs separate evidence: a disclosed allocation, its funding source, and executed purchases, with official reserves distinguished from holdings outside them. A shrinking dollar share supplies none of those details.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The New York Fed\u2019s Sept. 2 analysis separates currency choices from reserve-size changes, leaving sovereign Bitcoin demand unproven.<\/p>\n","protected":false},"author":1264,"featured_media":561345,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[120,76747,77968,77921],"tags":[81073,76769,80005,77433,75695],"prediction_market_topic":[],"post_folder":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v21.9 (Yoast SEO v21.9.1) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Why Bitcoin bulls shouldn&#039;t mistake a shrinking dollar reserve share for central bank buying<\/title>\n<meta name=\"description\" content=\"The New York Fed\u2019s Sept. 2 analysis separates currency choices from reserve-size changes, leaving sovereign Bitcoin 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