#ArizonaBTCReserve Arizona has moved closer to becoming the first U.S. state to create a Strategic Bitcoin Reserve by passing two bills—SB1025 and SB1373—allowing up to 10 % of public funds to be allocated to digital assets, chiefly Bitcoin, These measures authorize the State Treasurer to invest in and manage a Digital Assets Strategic Reserve Fund, financed by future appropriations and seized crypto assets, with strict on-chain auditability and risk controls The legislation now awaits Governor Katie Hobbs’s signature, with potential veto threats tied to broader budget negotiations.

Legislative Framework

Senate Bill 1025

SB1025, officially titled the “Arizona Strategic Bitcoin Reserve Act,” passed its third reading on April 28, 2025, with a House vote of 31–25. It authorizes up to 10 % of the state treasury and pension funds to be invested in Bitcoin, held in segregated Federal Reserve accounts to ensure custodial security.

Senate Bill 1373

SB1373 complements SB1025 by establishing the Digital Assets Strategic Reserve Fund, which will pool seized crypto and designated appropriations under standardized risk-management protocols.

Key Provisions

Allocation Cap: Up to 10 % of Arizona’s $31.5 billion in public funds may go into digital assets, primarily.

Auditability & Controls: All holdings and transactions must be auditable on-chain, with defined risk limits to protect public assets.

Custody & Segregation: Bitcoin reserves to be held in segregated Federal Reserve accounts, insulating them from broader treasury operations.

Implications

By voting to integrate Bitcoin into state finances, Arizona signals confidence in blockchain’s long-term value proposition—diversifying against inflation and fostering innovation in its financial ecosystem. If fully utilized, the 10 % allocation could mean over $3 billion redirected into crypto, potentially acquiring 15,000–31,000 BTC depending on market prices.

Next Steps & Outlook

Governor’s Decision: Governor Hobbs must sign or veto before the legislative session ends; her pending veto threats