Arizona has become the second U.S. state to adopt Bitcoin as part of its treasury strategy officially. On May 7, 2025, Governor Katie Hobbs signed House Bill 2749 into law, authorizing the creation of a Strategic Bitcoin Reserve funded through profits from unclaimed property, not taxpayer dollars. This makes Arizona a national frontrunner in digital asset adoption at the government level.

Getting a lot of questions about the Arizona SBR law singing into law.To be clear: There are 4 bills for SBR in AZ.SB 1025 was vetoed.HB 2749 was signed into law! https://t.co/X7VydTkO9E— Dennis Porter (@Dennis_Porter_) May 8, 2025

How It Works: Bitcoin Without Taxpayer Risk

Under HB 2749, the state will convert profits from dormant assets, such as forgotten bank accounts and uncollected checks, into Bitcoin and other top digital assets. The move is aimed at hedging against inflation and modernizing Arizona’s investment portfolio.

Importantly, this initiative does not involve any public taxes. Instead, it taps into existing unclaimed property revenues, turning idle funds into potentially appreciating assets.

The law also permits Arizona to collect rewards from staking, airdrops, and interest, making this not just a static reserve but a potentially yield-generating digital portfolio.

Broad Political and Industry Support

The bill was championed by Representative Jeff Weninger, a long-time blockchain advocate in the Arizona legislature. Crypto giant Coinbase also backed the bill, offering expert testimony and guidance to lawmakers throughout the process.

Although Senate Bill 1025, a similar proposal, was previously vetoed, HB 2749 succeeded and was signed, signaling strong bipartisan momentum around crypto-related policy in the state.

Governor Katie Hobbs’ endorsement cements Arizona’s leadership in blockchain innovation, joining Texas as one of the only states to integrate digital assets into state-level financial planning officially.

Security and Diversification at the Core

HB 2749 ensures that all digital holdings will be managed through regulated U.S. custodians, reducing counterparty risks and securing the state’s investments. While Bitcoin remains the flagship asset, the law allows room for portfolio diversification with other top digital assets, making the reserve flexible and resilient to market volatility.

Implications for the Broader U.S. Crypto Landscape

Arizona’s move may pave the way for other states to follow suit, especially as inflation concerns persist and traditional investment strategies face scrutiny. By leveraging dormant funds, Arizona showcases a low-risk, high-innovation approach to crypto adoption in the public sector.

This legislative success positions Arizona as a national leader in blockchain and decentralized finance (DeFi) integration at the government level.

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