Arizona’s Crypto Reserve Bill Advances to Third Reading
April 18, 2025 – Arizona is poised to take a significant step in the world of cryptocurrency with the recent advancement of the Strategic Digital Assets Reserve Bill (SB 1373). The legislation has successfully passed the House Committee of the Whole and is now just one vote away from reaching Governor Katie Hobbs for ultimate approval.
Bill Overview
Approved on April 17, SB 1373 aims to create a Digital Assets Strategic Reserve Fund, which would consist of digital assets seized through criminal proceedings. The management of this fund would fall under the purview of Arizona’s state treasurer, who would be empowered to invest up to 10% of the total fund in digital assets each fiscal year. Additionally, the treasurer would have the ability to loan the fund’s assets to generate higher returns, subject to restrictions to ensure financial risk is minimized.
Potential Challenges Ahead
Despite the bill’s momentum, its journey may face hurdles due to Governor Hobbs’ recent commitment to vetoing all legislation until a bill addressing disability funding is passed by the legislature. Notably, Hobbs has already vetoed 15 bills sent to her desk within the current week, raising concerns among proponents of SB 1373. Julian Fahrer, founder of Bitcoin Laws and CEO of Apollo, remains optimistic about the bill’s chances, indicating an expectation that it will successfully pass the House. He also mentioned the possibility of SB 1373 merging with another related bill, SB 1062, which seeks to broaden the definition of legal tender to encompass cryptocurrencies.
Competitive Landscape
Arizona’s legislative efforts in cryptocurrency are particularly noteworthy as they coincide with the ongoing "state Bitcoin reserve race." SB 1373 is progressing alongside the Arizona Strategic Bitcoin Reserve Act (SB 1025), which focuses specifically on Bitcoin (BTC) investments. This proposal also seeks to allow the Arizona treasury and state retirement system to invest up to 10% of available funds in Bitcoin. Like SB 1373, SB 1025 has cleared the House Committee of the Whole and is awaiting a full floor vote.
National Context
The legislative actions in Arizona are part of a broader trend across various states looking to establish legal frameworks for Bitcoin reserves. Notably, Utah advanced similar legislation in early March but later discarded a key provision aimed at establishing a Bitcoin reserve during the final reading. Meanwhile, the Texas Senate passed a Bitcoin reserve bill on March 6, with ongoing discussions regarding its viability. New Hampshire has also seen a similar bill pass through its House, signaling a growing interest in state-level cryptocurrency adoption.
Fahrer believes that while Arizona is making strides in this space, the Texas bill may ultimately have a better chance of becoming law, as it has encountered fewer obstacles thus far.
Conclusion
As Arizona ventures into uncharted territory with cryptocurrency legislation, the outcome of SB 1373 will be pivotal in shaping the state’s approach to digital assets. Stakeholders and observers will be closely monitoring the bill as it heads toward its crucial third reading, and its ultimate fate will have implications for the burgeoning U.S. cryptocurrency landscape.
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