Arizona Governor Katie Hobbs vetoed a bill that would have allowed the state to hold Bitcoin as an official reserve, ending Arizona’s efforts to become the first state to adopt such a policy, Cointelegraph reported.
The Digital Asset Strategic Reserve Act, which would have allowed Arizona to invest forfeited funds in Bitcoin and have state officials manage the reserve, was formally defeated on the state legislature’s website.
Hobbs said the Arizona retirement system is one of the strongest in the nation because it makes smart investments. She said retirement funds should not be used for untested investments such as virtual currencies.
The state House of Representatives passed the bill 31-25 on April 28. Hobbs has said he would veto any legislation not related to disability funding.
Another bill, SB 1373, which would allow state treasurers to invest up to 10% of emergency funds in digital assets, has not yet reached a final vote. Arizona joins other states that have failed to pass similar proposals in Oklahoma, Montana, South Dakota and Wyoming.
In contrast, the North Carolina House of Representatives passed a digital asset investment bill that would allow the state treasurer to invest up to 5% of its funds in approved cryptocurrencies. The bill has been sent to the state Senate for consideration.
The state-level effort to create a bitcoin reserve comes as U.S. President Donald Trump and Republican lawmakers push for similar action at the federal level. Trump signed an executive order in March proposing the creation of a “strategic bitcoin reserve” and a “digital asset reserve.”
