The United States is witnessing a growing divide among state governments over the strategic adoption of Bitcoin as a public financial asset. As of early 2025, 18 states are actively advancing legislation to establish Bitcoin reserves, while four—Montana, South Dakota, North Dakota, and Wyoming—have rejected or stalled similar proposals. This legislative tug-of-war underscores a broader national conversation about the role of digital assets in public finance, inflation hedging, and long-term fiscal strategy.
At the heart of the debate is whether state treasuries should allocate portions of public funds into Bitcoin, a volatile yet increasingly institutionalized asset with a market cap exceeding $1.8 trillion. Proponents argue that Bitcoin serves as a modern store of value and a hedge against inflation, while skeptics cite volatility, regulatory uncertainty, and lack of intrinsic value as key risks.
Montana and South Dakota Halt Bitcoin Reserve Proposals
Montana recently joined a small but growing list of states rejecting Bitcoin reserve legislation. House Bill 429, introduced by Rep. Curtis Schomer, aimed to allocate up to $50 million toward cryptocurrencies, stablecoins, and precious metals to diversify the state’s financial portfolio. Despite the potential for higher returns, the bill was defeated 41–59 in the legislature.
Opponents raised concerns about market volatility and the speculative nature of digital assets. Montana now stands alongside North Dakota, Wyoming, and South Dakota, all of which have paused or rejected similar initiatives.
In South Dakota, HB1202—a bill that would have allowed up to 10% of public funds to be invested in Bitcoin—was deferred by the House Commerce and Energy Committee in a 9–3 vote on February 25, 2025. While not formally killed, deferral effectively halts progress for the current legislative session.
Despite the setback, Rep. Logan Manhart remains committed to reviving the proposal next year. He argues that in times of rising inflation and monetary instability, Bitcoin offers a viable alternative to traditional fiat reserves.
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Ohio Moves to Protect Crypto Transactions and Self-Custody Rights
Not all state-level crypto developments focus on reserves. Ohio has taken a different but equally significant approach by introducing House Bill 116, also known as the Ohio Blockchain Basics Act. Proposed by Representative Steve Demetriou, this legislation seeks to create a clear and supportive regulatory environment for digital assets.
Key provisions include:
- Exempting cryptocurrency transactions from additional local or municipal taxes.
- Ensuring that only existing taxes applicable to fiat currency apply to digital assets.
- Affirming the right of Ohio residents to self-custody their cryptocurrencies without needing a Money Service Business (MSB) license.
- Allowing cryptocurrency mining in residential areas and protecting industrial mining operations from arbitrary zoning penalties.
- Requiring state pension funds to assess and report on the risks and benefits of investing in crypto ETFs within one year.
This forward-thinking bill positions Ohio as a leader in digital asset policy innovation, balancing consumer protection with economic opportunity.
Oklahoma and Arizona Lead the Charge on State Bitcoin Reserves
Oklahoma has made significant progress with its Strategic Bitcoin Reserve Bill, recently passed by the House of Representatives. The bill permits the state to invest up to 10% of public funds in Bitcoin and other digital assets, aligning with a broader national trend.
Arizona is advancing even further, with its Senate approving two major bills:
- SB 1373: Establishes a Digital Assets Strategic Reserve Fund, managed by the state treasurer.
- SB 1025: Allows direct investment of public funds into Bitcoin and other cryptocurrencies.
These legislative moves reflect Arizona’s ambition to become a hub for blockchain innovation and financial modernization.
Utah is also making headway—the state’s Bitcoin reserve bill has advanced to the second chamber of the Senate, signaling strong bipartisan support.
👉 Explore how states are turning Bitcoin into a strategic financial tool.
Texas Unanimously Approves Bitcoin Reserve Bill
Texas has emerged as a major player in the state-level Bitcoin movement. On February 27, 2025, the Texas Senate Business & Commerce Committee voted 9–0 in favor of Senate Bill 21, the Strategic Bitcoin Reserve Act, introduced by Senator Charles Schwertner.
The bill proposes creating a special fund—separate from general revenue—dedicated to holding Bitcoin as a long-term financial asset. The investment cap is set at 1% of the state’s general revenue, ensuring fiscal responsibility while allowing strategic exposure.
Additionally, Representative Giovanni Capriglione introduced complementary legislation that would allow Texas to accumulate Bitcoin through tax revenues, fees, and donations—mandating a minimum five-year holding period to discourage short-term speculation.
With its pro-innovation stance and robust energy infrastructure, Texas is positioning itself at the forefront of public-sector Bitcoin adoption.
National Momentum Builds for Government Bitcoin Holdings
The movement isn’t limited to individual states. At the federal level:
- Senator Cynthia Lummis has reintroduced The Bitcoin Act, proposing that the U.S. government acquire and hold 5% of Bitcoin’s total supply.
- Former President Donald Trump has publicly directed his administration to explore the creation of a national Bitcoin stockpile, though no formal executive order has been issued.
Market analysts estimate that if 20 U.S. states adopt Bitcoin reserve policies, collective purchases could exceed $23 billion, significantly influencing Bitcoin’s market dynamics.
Michael Saylor, a leading advocate for institutional Bitcoin adoption, remains optimistic despite recent price fluctuations. He emphasizes that volatility is short-term noise compared to Bitcoin’s long-term value proposition as digital gold.
FAQ: State Bitcoin Reserves – Key Questions Answered
Q: Why are states considering Bitcoin reserves?
A: States view Bitcoin as a potential hedge against inflation, dollar devaluation, and economic uncertainty. With growing institutional adoption, many see it as a strategic asset similar to gold.
Q: How much are states proposing to invest?
A: Proposals vary—most suggest caps between 1% and 10% of public funds. Texas, for example, limits investment to 1% of general revenue, while Arizona and Oklahoma propose up to 10%.
Q: What are the main risks of state Bitcoin investments?
A: Key concerns include price volatility, regulatory changes, cybersecurity threats, and the lack of dividend or yield generation from holding Bitcoin.
Q: Can individuals benefit from these state-level crypto policies?
A: Yes. Policies like Ohio’s Blockchain Basics Act protect individual rights to self-custody and use crypto freely. State adoption may also boost local crypto economies and infrastructure.
Q: Is there bipartisan support for state Bitcoin reserves?
A: Yes—support spans both parties. Republicans often emphasize financial sovereignty and anti-inflation benefits, while some Democrats support innovation and economic diversification.
Q: What happens if Bitcoin’s price drops after a state invests?
A: Most proposed bills include risk assessments and reporting requirements. Long-term holding strategies aim to ride out volatility, similar to how pension funds manage other asset classes.
The Road Ahead: A Nation Divided on Digital Assets
As of 2025, the U.S. stands at a financial crossroads. While 18 states push forward with bold Bitcoin reserve initiatives, others remain cautious or outright opposed. This divergence reflects deeper philosophical differences about money, risk, and the future of public finance.
However, the momentum is undeniable. From tax exemptions in Ohio to reserve funds in Texas and Oklahoma, the integration of Bitcoin into government balance sheets is no longer theoretical—it’s legislative reality in multiple states.
With federal interest rising and global counterparts like Switzerland and Brazil exploring similar strategies, the U.S. may soon face a critical decision: lead the world in public-sector crypto adoption or risk falling behind.
👉 Stay ahead of the curve—see how digital assets are reshaping government finance.
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