- Arizona leads U.S. states in Bitcoin reserve legislation.
- Legislation ensures transparency and risk management.
Arizona lawmakers passed two bills in one day that could make the state the first in the nation to create a Bitcoin reserve, taking a giant leap toward crypto integration into public finance. The legislation now needs approval from Governor Katie Hobbs.
On April 28, the Arizona Strategic Bitcoin Reserve Act, Senate Bill 1025, was passed by the Arizona House of Representatives by a vote of 31 to 25 against. Simultaneously, Senate Bill 1373, which establishes a Digital Assets Strategic Reserve Fund, was also approved with 37 in favor and 19 against.
SB 1025 provides that the state treasurer as well as the retirement system may allocate up to 10 percent of their funds into Bitcoin. If the U.S. Secretary of the Treasury establishes a federal Bitcoin reserve, Arizona may deposit its Bitcoin in a segregated, secure account within the U.S. Bitcoin reserve.
SB 1373 covers a framework for managing various digital assets, like Bitcoin, stablecoins, or NFTs. The legislative appropriations and seized crypto assets would sustain the fund with provisions that the funds do not lapse at the fiscal year’s end.
The bills had previously cleared the Arizona Senate on Feb. 27. The House passed them without amendments and are now on their way to be formally transmitted to Governor Hobbs for her final say.
Arizona is also ahead in the race to pass a state level Bitcoin reserve, as represented visually from the Arizona State Legislature, with both bills having passed both legislative chambers.
Governor Hobbs’ Stance Raises Uncertainty
The other budget issues of concern to Governor Hobbs have led her to weigh whether or not to sign new legislation. The week before, on April 17, she said on her official account she would not approve any bills until a bipartisan funding solution is reached for healthcare services for Arizonans with disabilities. “Legislation must wait until we resolve critical funding issues for our most vulnerable citizens,” she emphasized.
The position derives from ongoing budget negotiations. Health care funding is important to her administration, and she has already vetoed several bills this session because of unrelated disputes.
The heated debates of the House, as seen in the Arizona State Legislature’s video records from April 28, featured Republican co sponsors of the bills Sen. Wendy Rogers and Rep. Jeff Weninger. Adopting Bitcoin could diversify state assets and spur financial innovation, they contended.
Arizona may make history if it became the first US state to fully incorporate cryptocurrency into its fiscal strategy. This would likely serve as a model for other states, including Texas and New Hampshire, who are investigating such measures.
Broader Implications for Cryptocurrency Adoption
The bills fit into a growing national interest in cryptocurrency as a state issue, in response to federal action. Back in January this year, President Donald Trump signed an executive order for the creation of a Strategic Bitcoin Reserve and a Digital Asset Stockpile, indicating a change in the way governments view digital currencies.
Arizona’s legislation may also open the door for more crypto friendly policies. Bitcoin miners and blockchain node operators have already been protected by the state, which has also proposed that Bitcoin ETFs be introduced into its retirement plan portfolio.
