Arizona Governor Katie Hobbs has vetoed Senate Bill 1025, which aimed to establish a Strategic Bitcoin Reserve using seized funds. Citing Bitcoin’s risks, Hobbs deemed it unsuitable for state retirement investments. While other states have failed to pass similar bills, North Carolina moves forward with limited crypto investment. This decision has sparked disappointment among crypto advocates who saw potential in Bitcoin as a hedge against inflation.
In a significant turn of events, Arizona Governor Katie Hobbs has vetoed Senate Bill 1025, effectively ending the state’s ambitious push to become the first in the United States to set up a Strategic Bitcoin Reserve. The bill had previously been passed by the state’s House on April 28 with a narrow vote of 31-25. It aimed to permit Arizona to channel seized funds into Bitcoin, which was valued at around $96,314 each at the time, and to create a managed Digital Assets Strategic Reserve Fund.
Governor Hobbs, a Democrat, raised concerns regarding the volatility of Bitcoin, describing it as an “untested investment” that would be ill-suited for Arizona’s robust State Retirement System. In her veto letter to Senate President Warren Petersen, she emphasised, “Arizonans’ retirement funds are not the place for virtual currency.” This decision reflects her commitment made earlier to reject legislation not directly related to a bipartisan disability funding agreement settled on April 24.
The bill’s failure to gain sufficient backing has led some lawmakers to consider measures to overturn the veto. This news has understandably disappointed cryptocurrency advocates who had hoped investing in Bitcoin might offer a safeguard against rising prices and position Arizona at the forefront of financial innovation.
In the context of this veto, it’s worth noting that U.S. states like Oklahoma, Montana, South Dakota, and Wyoming have similarly grappled with attempts to establish Bitcoin investment plans, all of which have thus far failed. Interestingly, in North Carolina, a different approach is underway, as a law passed on April 30, 2025, permits the state to allocate up to 5% of certain funds into cryptocurrencies. This law is presently being scrutinised by the North Carolina Senate.
On the federal level, in March 2025, former President Donald Trump had signed an order to create a national Strategic Bitcoin Reserve and a Digital Asset Stockpile, indicating a supportive stance towards Bitcoin and other cryptocurrencies. Just days before the Arizona House of Representatives adopted the controversial legislation on April 29, Bitcoin’s potential was closely watched at every level of government.
