Arizona Takes a Decisive Step towards Creating a Digital Asset Reserve
The state of Arizona could become the first US territory to establish a strategic reserve of digital assets. The proposed SB 1373 bill, which aims to create a fund dedicated to crypto assets, has just cleared the crucial step of being approved in the House commission vote. It now only requires a final vote in plenary session before being submitted to Governor Katie Hobbs for approval.
This bill provides for the creation of a strategic fund composed of two main sources: credits allocated by the legislature and digital assets seized in judicial investigations. The state treasurer would be responsible for managing this fund, with the option to store cryptocurrencies through a qualified custodian or an exchange-traded product registered in the state.
A Regulated Management to Avoid Speculation
The state treasurer cannot invest more than ten percent of the total amount deposited in the fund during a given fiscal year.
The bill strictly limits the possibility of taking risks. It prohibits the treasurer from investing more than 10% of the portfolio funds within a fiscal year. Additionally, the treasurer would have the right to lend a portion of the digital assets to generate additional income, following a cautious approach inspired by institutional financial strategies.
The definition of digital assets included in the bill is broad, encompassing traditional cryptocurrencies like Bitcoin, stablecoins, non-fungible tokens (NFTs), and any blockchain-based digital asset offering economic value or access rights.
Another Bill Focused on Bitcoin
In parallel, the Arizona Senate also passed another bill on April 1st, the SB 1025 named the Arizona Strategic Bitcoin Reserve Act. This separate bill would authorize the state funds to invest up to 10% directly into cryptocurrencies, with a particular emphasis on Bitcoin. Together, these two legislative proposals show Arizona’s clear intention to position itself as a pioneer in the institutional integration of digital assets in the United States.
Progress Slowed Down by Political Tensions
Despite this momentum, the future of these bills remains uncertain. Governor Katie Hobbs has announced her intention to block all bills until the legislature passes a funding measure for individuals with disabilities. This veto threat could delay or even jeopardize the implementation of both SB 1373 and SB 1025.
A National Competition where Arizona Leads Texas and New Hampshire
According to Bitcoin Laws, an organization tracking bitcoin-related legislative initiatives, Arizona is currently the most advanced state in terms of legislation on strategic reserves of crypto assets. It clearly surpasses Texas and New Hampshire, which are also heading in this direction. In a context of growing polarization around crypto regulation, this lead could give Arizona a national leadership role in the public management of digital assets.
