Amidst fierce debates over the federal regulatory framework for cryptocurrencies, a 'civil war' regarding the future of Bitcoin has quietly erupted among the states of the United States. From the East Coast to the West Coast, states are rapidly delineating distinct camps on how to treat this emerging digital asset, forming a complex and divided regulatory map.
On one side are the proponents, represented by Texas, New Hampshire, and Arizona, who are actively legislating to include Bitcoin in state-level strategic reserves, viewing it as 'digital gold' to combat inflation and attract innovation. On the other side is the staunch opposition, led by Connecticut, which has passed the nation's first stringent law prohibiting any government investment or holding of virtual currencies, attempting to build a firewall between public finances and the crypto world. Between these two extremes are explorers like Louisiana, which has chosen a more cautious 'research first' approach. This policy divergence at the state level not only profoundly impacts the future of the U.S. crypto industry but also becomes a key window for the world to observe how Bitcoin integrates into traditional systems.
Cryptocurrency Civil War?
In the camp supporting Bitcoin, Texas's actions are undoubtedly the most indicative. As the second-largest economy in the United States (with a projected GDP of approximately $2.7 trillion in 2024), Texas Governor Greg Abbott has recently signed Senate Bill 21 (SB21), making it law. The passage of this (Bitcoin Reserve Bill) marks Texas's official entry into the ranks of state-level Bitcoin reserves.
The core content of Bill SB21 includes:
Authorize the establishment of a reserve fund: Authorize the Texas Auditor's Office to manage a dedicated strategic reserve fund for investing in cryptocurrencies.
Strict investment standards: Allow state funds to invest in cryptocurrencies with a market capitalization exceeding $500 billion for 24 consecutive months. Currently, only Bitcoin (with a market cap exceeding $2 trillion) meets this strict criterion.
Independent fund management: The reserve belongs to a special fund 'outside the state treasury' to prevent it from being repurposed. Its funding sources are diverse, including legislative appropriations, special revenue, cryptocurrencies obtained through purchases or forks/airdrops, investment returns, and donations from the public and private sectors.
Security and governance: The bill explicitly requires the state comptroller to safeguard the fund through a 'cold wallet' to protect assets from cyber threats. Additionally, a five-member advisory committee will be established to oversee and mitigate investment risks.
Lee Bratcher, chairman of the Texas Blockchain Council, predicts that Texas may initially invest 'tens of millions of dollars' into the fund. Supporters believe this move is not only a proactive measure for Texas to combat inflation and diversify assets, but also a crucial step in solidifying its leading position in digital asset innovation.
Texas is not fighting alone. As early as early May of this year, New Hampshire first enacted a similar Bitcoin reserve law, becoming the first in the nation. Following closely, Arizona, after initially vetoing, also passed a similar proposal on May 10. The actions of these three states clearly indicate a trend: some state governments are seriously considering Bitcoin as a value storage tool similar to gold, incorporating it into their long-term financial planning.
In stark contrast to the enthusiastic embrace seen in Texas and other places, Connecticut has chosen to go against the trend. The state's legislature recently passed (Bill HB7082) with an overwhelming consensus of 'zero votes against,' setting a precedent for explicitly prohibiting state government involvement in cryptocurrencies.
This law, which will come into effect on October 1, 2025, has stringent and comprehensive provisions:
Comprehensive prohibition of government participation: The bill explicitly states that 'the state government and any of its political branches' are not allowed to accept or request payment in virtual currency; they may not purchase, hold, invest, or establish any form of virtual currency reserves, including Bitcoin and stablecoins.
Strengthening regulation of the industry: In addition to prohibiting government participation, the bill imposes stricter requirements on cryptocurrency-related businesses operating within the state. All businesses handling cryptocurrency transactions, including digital wallets, exchanges, and Bitcoin ATMs, must obtain licenses issued by the state government.
Strict consumer protection: The bill mandates that cryptocurrency service providers must hold a 1:1 reserve of funds, prohibiting the misappropriation of customer funds. At the same time, they must provide users with clear risk disclosures, warning them about the irreversibility of cryptocurrency transactions, and provide additional protection for high-risk users such as the elderly and for large transactions. Furthermore, it prohibits payment applications from opening accounts for minors without parental consent.
Connecticut's legislative motivation is very clear: to guard against the potential risks that extreme price volatility of crypto assets poses to public funds. This extremely conservative stance makes it the most cautious end of the spectrum of cryptocurrency regulation in the United States.
Between the extremes of embrace and prohibition, Louisiana represents a third attitude: cautious exploration. The state’s House of Representatives passed a resolution on June 10 to establish a dedicated 'task force' to deeply study blockchain technology and artificial intelligence.
Lawmakers acknowledge that with nearly 20% of Americans holding cryptocurrencies, it is essential for state governments to understand the opportunities and risks it presents. The task force's responsibilities include: exploring potential applications of blockchain and artificial intelligence; studying the regulatory framework needed to manage its development; and collecting insights from industry experts, businesses, and communities through public hearings.
The task force will submit its research findings and policy recommendations to the state legislature by February 2026. Louisiana's 'plan before action' approach reflects a pragmatic attitude of not rushing to conclusions but rather hoping to make decisions based on a thorough understanding.
One Country, Multiple Systems?
The significant divergence among U.S. states on Bitcoin policy is shaping an increasingly fragmented domestic regulatory environment. States like Texas are opening their arms, attempting to position themselves as hotbeds of crypto innovation and safe havens for capital, while Connecticut is erecting high walls, potentially shutting out opportunities while isolating risks.
This state-level 'route dispute' is not just about Bitcoin; it is also about the differing bets each state places on the future direction of finance, technology, and economic development. Ultimately, which states can attract more innovative companies, talent, and capital may depend on who can provide a clear regulatory environment that both mitigates risks and encourages innovation more quickly. This Bitcoin policy experiment occurring within the United States will undoubtedly have far-reaching implications for the global trajectory of cryptocurrency development.