In a decisive move, Arizona Governor Katie Hobbs has vetoed House Bill 2324, intended to establish a reserve fund for managing cryptocurrency assets acquired through criminal forfeiture.
Key Insights:
The Arizona Governor’s veto blocks a proposed reserve fund for crypto assets obtained through law enforcement seizures.
The bill aimed to empower the State Treasurer to invest or engage in trading activities involving the seized digital assets.
In contrast, Texas has proceeded with the creation of its own Bitcoin reserve fund.
In a statement issued on Tuesday, Hobbs emphasized that the legislation would hinder collaboration among local law enforcement agencies by placing control of seized cryptocurrency assets beyond local jurisdictions.
Last week, the Arizona House passed HB 2324 by a close margin of 34-22.
Arizona Bill Sought State Control Over Seized Crypto Assets Reserve
The proposed bill would have designated the State Treasurer with oversight of a Bitcoin and Digital Assets Reserve Fund, granting the ability to invest or trade crypto assets acquired through criminal proceedings, including exchange-traded funds that contain digital assets.
Earlier this May, Arizona had already made strides by approving HB 2749, marking it as the second state in the U.S. to institute laws pertaining to a crypto reserve.
This previous legislation addressed the management of unclaimed cryptocurrency considered abandoned, while HB 2324 specifically focused on assets confiscated from criminal activities.
In the meantime, Arizona legislators are also considering additional crypto legislation, such as SB 1062, aiming to classify cryptocurrencies as legal tender within the state.
Arizona’s efforts coincide with a trend of several U.S. states retracting their attempts to establish a Bitcoin reserve strategy.
In May, Florida became the latest state to abandon crypto legislation, joining others such as Wyoming, South Dakota, North Dakota, Pennsylvania, Montana, and Oklahoma.
However, there is positive news from Texas, where Governor Greg Abbott signed Senate Bill 21, paving the way for the state’s first Bitcoin reserve, funded by state resources.
Unlike similar initiatives in Arizona and New Hampshire, Texas plans to create a distinct reserve fund separate from the state treasury.
This fund will be managed by Texas Comptroller Glenn Hegar and seeks to examine Bitcoin as a viable strategic asset class.
“We can buy land, we can buy gold; I think the state of Texas should have the option of evaluating the best performing asset over the last 10 years,” stated bill author Senator Charles Schwertner.
Bitcoin Adoption as Treasury Asset Finds Momentum
Recent developments indicate a surge in Bitcoin adoption among businesses, with at least nine firms in the UK—including web design startups and mining companies—revealing intentions to purchase Bitcoin or showcasing their recent acquisitions to enhance their corporate treasuries.
A notable example is AI services provider Tao Alpha, which announced efforts to raise £100 million following its decision to invest in Bitcoin, generating significant interest from investors.
Additionally, Smarter Web Company, a small website design firm, experienced a staggering increase in market value from £4 million to over £1 billion within two months after announcing its Bitcoin purchases in April, though its shares have since stabilized.
In the U.S., ProCap BTC, led by Anthony Pompliano, acquired 3,724 Bitcoin for $386 million as part of a strategy to go public via a SPAC merger, while Japan’s Metaplanet successfully raised $517.8 million on the first day of its ambitious “555 Million Plan,” aiming for 210,000 Bitcoin by the year 2027.
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