Texas is advancing legislation to establish a Bitcoin reserve, aiming to diversify its financial assets and position itself as a leader in cryptocurrency adoption. On March 6, 2025, the Texas Senate passed Senate Bill 21 (SB-21) with a 25-5 vote. Introduced by Senator Charles Schwertner, SB-21 proposes the creation of the Texas Strategic Bitcoin Reserve, allowing the state comptroller to invest in Bitcoin and other cryptocurrencies.
The bill outlines a framework for the reserve's administration, granting the comptroller authority to acquire, sell, and manage cryptocurrency holdings. An advisory committee, including cryptocurrency investment experts, would provide guidance on asset management strategies and risk mitigation. The reserve's holdings would be subject to strict security measures, such as using cold storage to prevent unauthorized access. A biennial report detailing the reserve's status would be submitted to the Texas Legislature and made available to the public.
Supporters argue that establishing a Bitcoin reserve could serve as a hedge against inflation and economic volatility, potentially yielding long-term financial gains for the state. However, critics express concerns about Bitcoin's price volatility and the potential risks associated with government involvement in digital assets. Some view the initiative as a form of cronyism that could lead to taxpayer-funded bailouts of the volatile cryptocurrency market.
Texas joins other states, such as Arizona and Utah, in exploring the establishment of Bitcoin reserves. At the federal level, President Donald Trump has proposed a nationwide crypto reserve initiative, reflecting a growing interest in integrating cryptocurrencies into government financial strategies.
As of March 7, 2025, SB-21 awaits consideration in the Texas House of Representatives. If enacted, Texas would become one of the first U.S. states to establish a government-backed Bitcoin reserve, potentially setting a precedent for others considering similar measures.