The Arizona Senate advanced a bill to create a state-managed reserve for seized bitcoin, passing SB 1373 by a 17-12 vote on Feb. 27 and sending it to the House for further consideration.
Arizona Senate Approves Strategic Digital Assets Reserve Bill, Advances to House
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Arizona Legislators Narrowly Pass Digital Assets Reserve Bill
The Strategic Digital Assets Reserve bill establishes a fund overseen by the state treasurer to hold bitcoin confiscated by law enforcement and money allocated by the legislature. Under the bill, the treasurer may invest up to 10% of the fund’s deposits in bitcoin annually and possibly loan them to generate returns, provided such actions do not heighten financial risks.
SB 1373 differs from a related proposal, SB 1025, which seeks to allow state entities to invest public funds in bitcoin. Instead, SB 1373 focuses on managing assets already in state custody, such as those seized during criminal investigations.
The Senate’s narrow approval reflects bipartisan contention over the state’s role in handling volatile digital currencies. Sponsored by Republican Sen. Mark Finchem, the bill aligns with broader efforts by states like Utah to integrate cryptocurrencies into public finance.
Proponents argue the fund could generate revenue through strategic investments while streamlining management of seized assets. Critics, however, question the risks of state involvement in crypto markets in general. This type of maneuver is also being looked into on the federal level.
SB 1373 now faces scrutiny in the Arizona House, where amendments or further debate could shape its final version. If enacted, Arizona would join a small group of states hoping to experiment with frameworks for strategic bitcoin management.
