Arizona Governor Katie Hobbs vetoed a bill to establish Bitcoin reserves, halting the state’s plan to be the first in the U.S. to adopt such legislation. Despite its passage in the House, Hobbs’ firm stance on requiring bipartisan support for disability funding led to the bill being blocked. Similar legislation statewide has seen setbacks, while other states like North Carolina are advancing crypto-related proposals.
In a surprising turn of events, Arizona Governor Katie Hobbs has vetoed a bill that would have made the state the first in the U.S. to hold Bitcoin reserves. The Digital Assets Strategic Reserve bill, which received its final approval from the House on April 28, was ultimately blocked on May 2. Governor Hobbs had previously indicated she would oppose any legislation that lacked bipartisan support for disability funding, and she acted on that promise with this veto.
The veto halts Arizona’s ambitious plan to invest seized funds into Bitcoin and create a reserve managed by state officials. This proposed legislation was designed not only to pave the way for Bitcoin investment but also to position the state as a frontrunner in digital asset policy within the United States. Notably, a companion bill was also in progress, which aimed to empower the state treasurer to allocate up to 10% of the state’s rainy-day fund towards cryptocurrencies like Bitcoin. However, it has yet to receive final approval.
Supporters of the Bitcoin reserve initiative argued that it could attract institutional investors and reflect a growing trend of crypto adoption among governments. They believed that embracing digital assets could signal Arizona’s progressive stance in the rapidly evolving financial landscape. On the other hand, critics described the move as potentially reckless, suggesting that using taxpayer funds for volatile cryptocurrencies could jeopardise fiscal stability.
With Arizona’s rejection of this landmark proposal, the state joins a list of others where similar legislation has met an untimely end. Just last month, Oklahoma’s version of a Bitcoin reserve bill failed in committee, and initiatives in Montana, North Dakota, and Wyoming have also faltered in recent months.
Interestingly, the momentum for digital asset legislation seems to be trending east. North Carolina’s legislature made strides when its House approved the Digital Assets Investment Act on April 30. This bill, which now moves to the Senate, permits the state treasurer to invest up to 5% of specific funds into approved cryptocurrencies. Additionally, a related measure could delegate crypto investment oversight to a newly established state agency.
Nationally, the landscape remains active, as according to Bitcoin Laws, over 35 digital asset reserve bills are currently under consideration across 20 states, though moving from proposal to law has proven time-consuming and challenging so far. The fate of digital currencies in state reserves continues to unfold as discussions persist.
For ongoing updates about this situation or to share insights, readers can reach out to Kyle Baird at [email protected].
