Arizona is poised to become the first state to join federal efforts in planning a Bitcoin reserve, as its digital assets stockpile bill clears legislature despite uncertainty over Governor Katie Hobbs’ approval.
The Arizona House of Representatives has passed a bill to form a digital assets stockpile, sending the state closer to becoming the first to join federal efforts in planning a Bitcoin reserve.
Bitcoin is a decentralized digital currency that allows for peer-to-peer transactions without the need for intermediaries.
Launched in 2009 by an individual or group using the pseudonym Satoshi Nakamoto, bitcoin uses cryptography to secure and verify transactions.
The total supply of bitcoin is capped at 21 million, with new coins created through a process called mining.
As of 2022, over 18 million bitcoins have been mined, with a market capitalization of over $1 trillion.
The Push for Crypto Reserves Gains Momentum Across the US
Several other states have advanced similar bills this year, but none have yet reached the finish line. Arizona’s move has sparked interest among lawmakers and experts, who see the potential benefits of incorporating digital assets into public-funds investments.
The U.S. Treasury Department is also working on a crypto reserve effort, which still awaits a full accounting of its holdings before federal officials can move forward. If approved, Arizona’s inclusion of digital assets could even outpace the federal effort.
Crypto reserves refer to the amount of cryptocurrency held in reserve by exchanges, wallets, and other entities.
These reserves serve as a safeguard against market fluctuations and ensure liquidity for users.
According to a report, the top crypto exchanges hold over $50 billion in reserves, with Bitcoin dominating the majority of these holdings.
Crypto reserves play a crucial role in maintaining market stability and preventing price manipulation.
Governor Hobbs’ Veto Power Hangs in the Balance
However, the bill must now survive a potential veto from Democratic Governor Katie Hobbs, who has been in a budget dispute with Republican lawmakers. In an April 17 posting on social media site X, she stated that any bill not already on her desk would be vetoed until a serious, bipartisan funding solution is found to protect healthcare for Arizonans with disabilities.
Katie Hobbs is an American politician serving as the Governor of Arizona since January 2023.
She previously served as the Secretary of State of Arizona from 2019 to 2023.
Born on December 4, 1965, in Arlington, Virginia, 'Arlington' , Hobbs earned a Master's degree in Social Work from Barry University.
Her political career spans over two decades, with a focus on education and social welfare issues.
As Governor, she has prioritized addressing the state's budget crisis, expanding Medicaid, and promoting education reform.
A recent resolution of this issue may have paved the way for Hobbs’ approval of the disabilities-funding bill last week. However, it remains unclear whether she will look favorably on the cryptocurrency legislation.
If approved, Arizona’s inclusion of digital assets in its public-funds investments could set a precedent for other states and even influence federal policy. As the debate around crypto reserves continues to gain momentum, one thing is clear: the future of digital assets in state and federal finances is uncertain, but it will undoubtedly be closely watched.
