On March 24th, two significant bills aimed at establishing digital asset reserves in Arizona successfully cleared the state House Rules Committee, paving the way for a full vote on the House floor. The legislation includes the Strategic Digital Assets Reserve Bill (SB 1373) and the Arizona Strategic Bitcoin Reserve Act (SB 1025), positioning Arizona to potentially become the first state in the U.S. to create a strategic digital asset reserve.
Arizona’s Digital Asset Legislation
The Strategic Digital Assets Reserve Bill (SB 1373) is designed to establish a reserve fund composed of digital assets seized during criminal investigations. This initiative would enable the state treasurer to manage these assets, capped at a 10% annual investment rate. Additionally, it provides the option for these assets to be loaned for enhanced returns, given that such transactions do not expose the state to undue risks.
Conversely, the Arizona Strategic Bitcoin Reserve Act (SB 1025) focuses specifically on Bitcoin. It proposes allowing the Arizona Treasury and the state’s retirement system to invest up to 10% of available funds into cryptocurrencies. Notably, this bill includes a clause that aims to secure any Bitcoin investments in a segregated account within a prospective federal Bitcoin reserve.
The prevailing Republican majority of 33-27 in Arizona’s House of Representatives suggests a positive outlook for the passage of these bills. However, uncertainty looms as they require approval from Governor Katie Hobbs. Known for her propensity to veto legislation, Hobbs’ record from 2024, where she vetoed 22% of bills—the highest rate among all state governors—raises questions about the future of these innovative proposals.
Other states are exploring similar initiatives; for example, Texas recently advanced its Strategic Bitcoin Reserve Bill (SB-21) with a 25-5 vote, though it still needs final approval from the House and the governor. In contrast, Utah opted not to pursue a strategic reserve, while Oklahoma’s HB1203 Bitcoin Reserve Bill passed the House with a 77-15 vote on March 25.
Kentucky Governor Signs “Bitcoin Rights” Bill Into Law
In a notable development, Kentucky Governor Andy Beshear signed the “Bitcoin Rights” bill into law, providing crucial legal protections for cryptocurrency users. House Bill 701, introduced by Rep. Adam Bowling in February, ensures the right to self-custody, operate a crypto node, and utilize digital assets free from discrimination. The bill garnered unanimous support in both the state House and Senate before being signed into law on March 24.
As Arizona progresses on its digital asset legislation, the landscape of cryptocurrency regulation continues to evolve across the United States, presenting exciting opportunities and challenges for lawmakers, investors, and consumers alike.
