If Central Bank of nation N were to simply create currency and exchange it for Bitcoin, the effect would be (1) the price of Bitcoin would rise until CB stopped buying, and in no case could it buy all or even a significant portion of the BTC on the market (the more is bought the higher and faster it rises) (2) the national currency of N would be devalued, instantly vs. Bitcoin, and gradually vs. other fiat currencies.
Risto calculated that $4 billion of new investment would drive the price to $7000. It would be interesting to calculate how much $$ it would take to accumulate one or two million bitcoins. At a constant value of $7000, it would take $ 7-14 billion, which is peanuts for the Fed, and would have virtually no effect on the value of the USD (other than the fact that the rest of the world might think the leaders of the Fed were all insane, lol). Of course that much investment would drive the price higher. But I think they could feasibly get a sizeable chunk of all bitcoin in existence, in principle at least. Maybe even enough to cover the entire US debt in a coupla years.
