Texas Becomes Third US State to Establish Bitcoin Reserve
Texas has taken a significant step towards embracing the future of finance by passing Senate Bill 21, establishing the Texas Strategic Bitcoin Reserve. This move places Texas in the company of Arizona and New Hampshire, making it the third state in the U.S. to incorporate Bitcoin into its state investment strategy.
The “Texas Strategic Bitcoin Reserve and Investment Act” has successfully navigated both legislative chambers and now awaits Governor Greg Abbott’s final approval. Upon enactment, the State Treasurer will oversee the fund’s administration, enabling direct investments in Bitcoin and other approved cryptocurrencies.
The legislation outlines strict guidelines for the fund’s operations, including the requirement that only cryptocurrencies with a 12-month average market cap of at least $500 billion can be acquired. Additionally, assets must be stored using secure “cold storage” technology to prevent unauthorized access, and the State Treasurer can engage third-party partners for operational assistance.
Funding sources for the reserve include legislative appropriations, donations, and returns on investments. While the reserve will function independently, the State Treasurer has the authority to temporarily liquidate assets for state cash management under limited circumstances.
Governor Abbott’s positive stance on Bitcoin suggests a high likelihood of signing the bill into law. In a recent interview, Governor Abbott emphasized Texas’ commitment to leading in the realm of blockchain technology, recognizing the significance of Bitcoin on a global scale.
The passing of this bill signals a broader trend towards cryptocurrency adoption within state governments. New Hampshire’s recent enactment of a similar bill sparked a movement that Texas is now actively participating in, showcasing a forward-thinking approach to financial management.
As the crypto landscape continues to evolve, it is clear that government entities are starting to recognize the potential that digital assets offer in diversifying and safeguarding financial reserves. Texas’ decision to establish a Strategic Bitcoin Reserve echoes a growing sentiment within the industry that cryptocurrencies are here to stay and play a significant role in shaping the future of finance.
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