Texas legislators have proposed a bill that would establish a Bitcoin reserve managed by the state, in order to examine how crypto could be used to improve public finances.
The legislation, filed on December 13 by Republican Rep. Giovanni Capriglione (R-CA), would permit the state to collect tax, fees and donations in Bitcoin with assets that are held for at minimum five years.
Titles “An Act Relating to the Establishment of a Bitcoin Reserve Within the State Treasury of Texas and the Management of Cryptocurrencies by Governmental Entities,”The proposal doesn’t include any provisions that would allow the government to directly purchase Bitcoin.
The focus is on the voluntary contribution and payment of funds to build a reserve.
This proposal was announced at an X Spaces conference. It is intended to give the government an alternative tool for financial management while leveraging Bitcoin’s existing infrastructure. The Satoshi Action Fund is a non-profit organization that focuses on crypto policies.
Capriglione, according to:
“Inflation remains a significant challenge to maintaining the value of long-term investments. This initiative offers an opportunity to explore Bitcoin as a potential safeguard for the state’s financial stability.”
Texas’ role in crypto
Texas is the state with the largest concentration of Bitcoin miner in the United States. This presents a great opportunity for the integration of crypto in government operations.
Supporters of the bill suggest that accepting Bitcoin payments from these entities could further enhance Texas’ role as a leader in digital innovation. Capriglione said the bill’s goal is to provide “flexibility while encouraging broader adoption.”
Then he added:
“The proposal is a starting point, with room for further development as it gains legislative support.”
Bill reflects growing interest in government policy to include Bitcoin. President-elect Donald Trump’s campaign included a proposal for a federal Bitcoin reserve, and Bitcoin prices have risen over 45% since the November election, reflecting increased market attention.
Bitcoin reserve conversations continue
Texas is just one of many states that have looked into legislation relating to Bitcoin reserve. Pennsylvania proposed a similar measure in November. Discussions are underway about similar measures in other countries and states.
Satoshi Action Fund’s CEO Dennis Porter said that Texas is part of a larger shift in US states. “beginning to consider Bitcoin as a tool to address economic challenges.”
The movement is growing, he said. He cited legislative changes in Oklahoma and Louisiana focused on mining rights and self-custody.
Since it was announced as a valid plan early in the year, the idea of a bitcoin reserve for federal use has been gaining significant momentum.
At the Bitcoin 2024 event, Donald Trump, president-elect, outlined plans for Bitcoin to be integrated into national strategies, and Wyoming senator Cynthia Lummis presented her own plan for a central bank.
Market analysts, despite growing interest and reports that plans are in the advanced stages of development, remain skeptical about the possibility of federal action. They do however acknowledge growing interest in Bitcoins as a form of financial instrument.
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