New Hampshire State Representative Keith Ammon has put forward a groundbreaking piece of legislation that aims to establish a strategic reserve of digital assets for the state treasury. The proposed bill sets a target of over $500 billion in average yearly market cap for these alternative assets, with a maximum investment cap of 10% of the total public funds, amounting to roughly $360 million based on the treasury’s ending balance as of June 30.
One of the key requirements outlined in the bill is that these digital assets must be held through secure custody solutions, ensuring that there is exclusive access to cryptographic private keys. Additionally, the bill mandates that these assets must be held by qualified custodians and registered exchange-traded products (ETP) approved by regulatory bodies such as the SEC or CFTC.
Interestingly, the legislation specifies that only Bitcoin meets the market cap requirement for cryptocurrencies, although stablecoins like Tether USD (USDT) and USD Coin (USDC) can also be included in the state’s investment portfolio. The bill also allows for investment in traditional precious metals like gold, silver, and platinum, alongside cryptocurrencies.
Moreover, the proposal opens the door for New Hampshire to engage in staking, despite Bitcoin being the only crypto currently meeting the criteria. This move suggests that the state may consider adding other cryptocurrencies like Ethereum (ETH) and Solana (SOL) in the future, provided their market caps meet the required threshold.
In response to concerns about the bill being a covert way to introduce Bitcoin into state treasuries, Satoshi Action Fund CEO Dennis Porter clarified that the high market cap requirement was included to limit state investment in Bitcoin. He emphasized that developing tech-neutral bills is a common practice in policy-making to reduce political friction.
New Hampshire joins a growing list of states, including Pennsylvania and Texas, that are exploring the establishment of a Bitcoin strategic reserve. With 10 more states reportedly gearing up to introduce similar bills in the near future, it seems that the concept of state-backed cryptocurrency reserves is gaining momentum across the country.
In conclusion, the proposed legislation in New Hampshire represents a significant step towards embracing digital assets as part of the state’s financial strategy. By diversifying its investment portfolio to include cryptocurrencies and exploring innovative options like staking, New Hampshire is positioning itself at the forefront of the evolving financial landscape.