Bitcoin Legislation Advancing at State Level in the US: A Detailed Look at State Bitcoin Reserve Proposals
Behind the scenes, Bitcoin legislation is making significant strides at the state level in the United States, with nearly 30 proposals aiming to allocate funds into reserves. According to Matthew Sigel, Head of digital assets research at VanEck, around 20 of these bills have the potential to drive up to $23 billion in buying power, equivalent to approximately 247,000 BTC, if they come into effect.
The proposed bills vary in their approach to sourcing public funds, with some states looking to channel general budgets, special revenue accounts, and “Rainy Day” funds into Bitcoin. Oklahoma, for example, is considering a 10% allocation from its $14.7 billion state funding sources, which could translate to more than 15,000 BTC. Massachusetts has introduced a measure targeting its $8.8 billion “Rainy Day” fund, while Texas is exploring legislation that could commit at least 1% of unencumbered general revenue towards Bitcoin.
While some proposals specify fixed percentages, others do not, as seen with states like New Hampshire and Montana. Wyoming’s initial effort to allocate 3% of its $27.1 billion funds to Bitcoin has been marked as failed, but other states continue to push similar bills through committees or introductory stages. States like Iowa, Missouri, New Mexico, and South Dakota are also weighing different percentages, indicating a shared belief that Bitcoin could serve as a hedge or alternative store of value.
North Carolina recently joined this trend by introducing a plan to invest 10% of select state funds in Bitcoin. Proponents cite inflation hedging and diversification as reasons for this move, while critics point to the volatility of Bitcoin as a potential barrier to widespread adoption in state portfolios.
States are adopting various funding approaches for these proposals. Maryland is exploring allocations through a gambling enforcement revenue stream, while Ohio’s proposal involves designated donations and interim state funds. Kentucky is linking Bitcoin investing to assets surpassing a specific market capitalization threshold, which predominantly affects Bitcoin due to its leading position in digital asset rankings. Advocates argue that even small positions in Bitcoin can help familiarize government entities with emerging technology and showcase openness to innovation from the private sector.
At the federal level, interest in Bitcoin reserves remains limited to early-stage discussions, with no definitive action taken yet. However, the momentum at the state level suggests that local governments view Bitcoin as a strategic resource, especially for specific budget categories and investment pools. While some states have halted or rejected these efforts, the overall trend indicates a growing push to formalize Bitcoin holdings as part of state-level fiscal policy.
Legislative committees will continue to evaluate each bill, with some measures possibly returning for further debate despite initial setbacks. Proposals that survive committee scrutiny may undergo amendments before final votes, highlighting Bitcoin’s potential role in government strategies. If these plans are enacted in substantial form, they could potentially reshape how public funds are allocated across the United States.