On May 28th, both houses of Arizona in the United States approved a pioneering measure by nearly non-partisan voting, making Arizona the first state in the country to pass legislation to establish a strategic Bitcoin (BTC) reserve.
The bill was proposed by Republican Senator Wendy Rogers. The bill authorizes the Arizona Department of Finance to invest part of its public funds in Bitcoin. According to the details shared by Dennis Porter, the CEO of Satoshi Nakamoto Action Fund, no member of parliament was absent or on leave during the two key voting periods. Ultimately, the bill was passed in the House of Representatives with 29 votes in favor and 25 against. In the Senate, there were 31 votes in favor and 25 votes against. However, four senators did not participate in this vote.
At present, the bill has been submitted to Governor Katie Hobbs for further review. However, Governor Hobbs has not yet clearly indicated whether she will sign or veto this bill. It is worth noting that the governor recently promised that she would veto all the bills sent to her desk before the new budget was passed by the state legislature. Although Hobbs did not make specific comments on Senate Bill 1025 (SB1025), the broad veto stance she adheres to undoubtedly adds a lot of uncertainty to the ultimate direction of the bill.
Supporters of the proposal firmly believe that establishing a Bitcoin reserve is of great significance to Arizona. They believe that this measure can help the state achieve asset diversification, effectively resist the impact of inflation, and at the same time enable Arizona to seize the initiative and take the lead in the field of digital financial innovation. Supporters also point out that Bitcoin has the notable characteristics of a fixed supply and decentralization. Compared with traditional legal reserve assets, it shows unique advantages in the current context where national debt and currency devaluation issues have raised widespread concerns.
Meanwhile, the proposal has also drawn a lot of criticism. Critics warn that the price of Bitcoin fluctuates extremely sharply, and this feature may expose state funds to huge financial risks. Some people are deeply concerned about the lack of effective federal regulation of crypto assets and question the rationality of using public funds to invest in speculative assets.
Judging from the content of the bill, Bitcoin investment will be included in the digital currency holding portion of the state’s investment portfolio, which means it is subject to strict supervision and restrictions stipulated by the existing public funds management regulations in Arizona.
This breakthrough move in Arizona emerged against the backdrop of extensive discussions across the United States on the role of digital assets in public finance.
Although the legislative bodies of many states have engaged in intense debates on bills related to crypto assets in recent years, Arizona has undoubtedly taken the lead, becoming the first state to explicitly authorize the establishment of a Bitcoin reserve. Nowadays, Governor Hobbs’ final decision is highly anticipated, and his choice will determine whether Arizona will officially become the first state in the United States to incorporate Bitcoin into its fiscal strategy.
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