Crypto-Friendly Laws Approved By Arizona Lawmakers

Arizona lawmakers have approved two related bills that could position the state at the forefront of state governance cryptocurrency investing, assuming they receive the governor’s signature from Governor Katie Hobbs.

The Arizona House approved Senate Bill 1025 during its final reading. Legally designated as the “Arizona Strategic Bitcoin Reserve Act,” the House passed it 31-25-4 on Monday.

S.B. 1373, a complementary bill creating a “Digital Assets Strategic Reserve Fund,” was approved with a 37-19-4 House vote conducted on the same day.

Previously, on February 27, the Arizona Senate approved both bills. After approving both chambers without any revisions, the bills awaiting official forwarding to Governor Hobbs’ desk.

Both bills create Arizona’s moves toward its intended state of cryptocurrency assets. SB1025 concentrates solely on Bitcoin as an investment fund, while SB1373 develops frameworks for managing multiple digital assets.

A different plan to add Bitcoin ETFs to the state’s retirement savings for government workers was suggested in March. Arizona also moved forward with a bill earlier this month to protect Bitcoin miners and blockchain operators.

SB1025: Arizona’s Plan for a Strategic Bitcoin Reserve

SB1025 sets the framework for managing state funds from entities like the state treasury and pensions.

The bill also says that if the U.S. Treasury creates a Strategic Bitcoin Reserve to hold government-owned Bitcoin, Arizona could choose to keep its own digital money there in a safe, separate account.

SB1025 proposes to change Arizona law to permit the state treasurer and retirement systems to invest up to 10% of government funds in digital currencies, particularly Bitcoin.

Arizona Introduces SB1373: Digital Assets Strategic Reserve Fund

SB1373, at the same time, creates an asset to hold “funds allocated by the legislature and digital assets that are removed by this state,” which includes those taken through legal actions against crime.

For SB 1373, money given by the legislature does not automatically run out or “expire” at the end of the fiscal year, which is usually required by Arizona law.

The fund may hold digital currencies, like Bitcoin, NFTs, and stablecoins, which the State Treasurer would control via authorised custody methods.

Identifying and Aligning Funding Priorities

If the two bills are passed, Arizona will become the first state to completely adopt crypto into its financial framework, building on similar initiatives from other states.

The bills need the governor’s consent, which has been in danger because of the last budget talks and political divisions.

Governor Hobbs warned earlier this month on X that any bill not already on her desk would be vetoed. She said “extreme Republican legislators” are using funding for people with disabilities as a bargaining chip in their political games.

Although a budget disagreement seemed to be settled last Friday, Hobbs has not yet given an official statement regarding SB1025 and SB1373.

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