Arizona’s push to create a digital assets reserve fund is just one vote away from potentially reaching the governor’s desk—though recent veto threats from Governor Katie Hobbs could throw a wrench in the plan.
SB 1373 Gains Momentum in Arizona Legislature
On April 17, Arizona’s House Committee of the Whole advanced SB 1373, known as the Strategic Digital Assets Reserve Bill. The next step is a third reading and a final full floor vote in the House. If passed, the bill would then head to Governor Hobbs for approval.
The bill outlines the creation of a Digital Assets Strategic Reserve Fund, composed of crypto assets seized through criminal proceedings and other state-designated sources. Arizona’s treasurer would manage the fund and would be authorized to:
- Invest up to 10% of the fund’s value in digital assets each fiscal year
- Loan out fund assets to generate additional returns, as long as it doesn’t increase financial risk
Veto Warnings Loom Over Crypto Legislation
Despite bipartisan support, SB 1373 could face a veto. Governor Hobbs recently pledged to block all bills until the state legislature approves funding for disability services. She has already vetoed 15 bills this week alone, raising doubts about the future of this and other crypto proposals.
Julian Fahrer, CEO of Apollo and founder of Bitcoin Laws, remains optimistic. He believes SB 1373 will pass and may even merge with another piece of legislation—SB 1062, which seeks to broaden the definition of legal tender to include cryptocurrencies.
Arizona Leads in State Crypto Reserve Efforts
Arizona has become a front-runner among U.S. states looking to integrate Bitcoin into public financial planning. SB 1373 is being discussed in tandem with the Strategic Bitcoin Reserve Act (SB 1025), which would authorize the state treasury and retirement systems to invest up to 10% of their assets in Bitcoin.
SB 1025 passed the House Committee of the Whole on April 1 and awaits a final floor vote.
Other states have introduced similar measures:
- Utah passed a Bitcoin bill in March but dropped its reserve provision before final approval.
- Texas passed a Bitcoin reserve bill through the Senate on March 6.
- New Hampshire recently approved a comparable bill in its House.
While Arizona has made significant progress, Fahrer noted that Texas may be the most likely to enact a crypto reserve law, given its fewer political obstacles.
