Bitcoin Reserves? 17 States Eye Crypto Investments!

Proposed State Legislation Regarding Bitcoin Reserves

Legislators in Kentucky, Maryland, and Iowa have recently presented bills designed to establish strategic Bitcoin (BTC) reserves within their respective state financial frameworks. These new initiatives bring the total number of U.S. states exploring the incorporation of Bitcoin into their reserves to 17, signaling a growing trend towards integrating digital assets into public financial strategies.

Kentucky’s Proposed Legislation

Kentucky’s proposed bill, officially designated as House Bill 376 and championed by Representative TJ Roberts, aims to reshape the state’s financial policies. The legislation seeks to broaden the investment portfolio available for managing surplus state funds. It modifies the regulations governing the State Investment Commission, allowing for investments not only in a range of traditional asset classes—such as U.S. government bonds and collateralized certificates of deposit—but also in digital assets.

A central aspect of the legislation is the stipulation that any digital asset considered for investment must have maintained an average market capitalization of at least $750 billion over the preceding calendar year. Bitcoin meets this criterion, and the bill mandates that such investments should not exceed 10% of the total excess cash held by the state. Furthermore, the law permits state agencies to accept payments in digital assets and precious metals while specifically excluding central bank digital currencies. The revised regulations also pave the way for state retirement funds and deferred compensation plans to invest in exchange-traded products related to these digital assets.

Moreover, the proposed framework outlines the procedures for managing digital asset receipts, ensuring conversion into U.S. dollars when necessary. This framework empowers state agencies to establish further regulations to maintain oversight of these investments.

Initiatives in Maryland and Iowa

In Maryland, Representative Caylin Young has introduced House Bill 1389, which is centered on establishing the Maryland Bitcoin Reserve Fund. This plan aims to designate Bitcoin as a core reserve asset and uniquely empowers the State Treasurer to invest funds collected from the enforcement of certain gambling regulations directly into Bitcoin.

Iowa is also participating in this movement through House File 246, introduced by Representative Taylor Collins. This legislation authorizes the State Treasurer to invest not only in traditional assets like precious metals but also in digital assets that meet the required market capitalization threshold of $750 billion. The bill expands investment options to include stablecoins and allows for allocations from multiple funds, such as the state’s general fund, cash reserve fund, and economic emergency fund. However, it caps digital asset investments at a maximum of 5% of the public funds available at the time of investment.

Summary of State Proposals

State	Legislative Proposal	Key Features
Kentucky	House Bill 376	Expands investment opportunities for surplus funds Allows investments in various asset classes, including digital assets Limits digital asset investments to 10% of excess funds
Maryland	House Bill 1389	Establishes the Maryland Bitcoin Reserve Fund Enables investment of funds from specific regulatory enforcement actions
Iowa	House File 246	Authorizes diversified investments, including stablecoins Investments drawn from multiple state funds Limits digital asset exposure to 5% of available funds

These legislative efforts represent a significant change in how state governments are approaching financial management, with digital assets such as Bitcoin playing an increasingly important role. As more states consider similar measures, the integration of cryptocurrency into public funds may become a defining characteristic of state fiscal policy.