The Texas House of Representatives introduced legislation to establish a strategic Bitcoin reserve that could act as a proving ground for the US Treasury.
Texas Representative Giovanni Capriglione introduced the legislation at a time when BTC is attracting significant attention.
Texas To Establish Bitcoin Reserve?
The Texas House of Representatives introduced legislation to establish a strategic Bitcoin reserve, a move that mirrors efforts on the national level. The proposed bill, H.B. No. 1598, was introduced by Texas State Representative Giovanni Capriglione and aims to build a strategic supply of Bitcoin (BTC) for the state with funds held for at least five years without being sold. Citizens will also be allowed to donate to the fund. The bill states,
“A strategic Bitcoin reserve aligns with Texas’s commitment to fostering innovation in digital assets and providing Texans with enhanced financial security.”
The bill also states that cryptocurrency stored in cold wallets will not be used to make transactions outside of the state or abroad.
“The comptroller shall prohibit transactions involving foreign countries, entities or individuals outside of Texas, or entities or individuals known to engage in illegal activities.”
Dennis Porter, the founder of the Satoshi Action Fund, confirmed the bill had been introduced in an X space. Texas is one of ten states exploring creating a strategic Bitcoin reserve. Porter believes the passing of legislation at the state level is key for establishing a federal Bitcoin reserve.
“I can confirm that the state of Texas has filed a bill to officially establish a ‘Strategic Bitcoin Reserve’. History was made as this was the first time a bill was filed live on X Spaces. Congrats to @VoteGiovanni for his leadership on Bitcoin.”
A Long-Standing Idea
Capriglione stated on a Spaces live event that he toyed with the idea for a considerable amount of time, discussing it with members and educating them about Bitcoin.
“We’ve slowly planted the seeds and planted the education for members. Probably the biggest enemy of our investments is inflation. A strategic bitcoin reserve, investing in bitcoin, would be a win-win for the state.”
Texas is the second-largest economy in the US and the eighth-largest globally. It also has the highest concentration of Bitcoin miners. Capriglione hopes some of them will begin paying their taxes in crypto. The current proposal does not include a direct Bitcoin purchasing strategy. The Texas Representative added,
“My goal is to make this bill as big and as broad as possible. This initial step is to allow some optionality and flexibility on it, but if I can get support from other legislators, we will make it even stronger.”
Will The US Establish A Bitcoin Reserve?
However, there is some doubt about the US establishing a strategic Bitcoin reserve. If it does, it is unclear if it will be the first. Either way, the idea could act as a positive market catalyst and drive other countries to establish their reserve, irrespective of whether the US does so or not. Needham’s John Todaro stated,
“It’s unlikely to occur, but it helps get animal spirits back into the market. It’s also unlikely to drive material price gains, as we do not expect the U.S. government will purchase bitcoin in any meaningful capacity, but it’s an item that drives excitement and optimism.”
Other States Exploring The Idea
Several other states are also exploring a strategic Bitcoin reserve. Pennsylvania introduced a strategic Bitcoin reserve bill in November, and discussions are ongoing in at least ten states to introduce similar legislation. Porter, who worked with Capriglione on the Texas draft bill, is also assisting lawmakers in Louisiana, Arkansas, Montana, and Oklahoma, with similar legislation.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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