States Move Closer to Investing in Cryptocurrencies

Several U.S. states are making progress on plans to invest public money in cryptocurrencies, following President Donald Trump’s announcement to do the same on a federal level. Texas and New Hampshire are among the leading contenders.

Texas Takes a Step Forward

On Thursday, the Texas State Senate passed the SB 21 bill, which would allow the state to invest some of the public’s money into digital assets, specifically Bitcoin (BTC).

Bitcoin has “proven itself through multiple boom and bust cycles,” said Texas Senator Charles Schwertner, making it a great reserve asset in times of a “devastating national deficit” along with “inflation and uncertainty.”

New Hampshire Moves Forward

New Hampshire also passed a bill on Wednesday through a state house committee, House Bill 302, which would allow the state to invest up to 5% of public funds into Bitcoin and other precious metals.

Others Make Efforts

Almost a dozen states have made strong efforts to pass a bill that would allow similar allocations, while at least five states have faced setbacks or no votes.

Utah’s Progress

Utah has been the frontrunner in these efforts and is just one senate approval away from sending a bill to its governor’s desk. However, the legislative session expires this week, leaving little time to get the senate to join the state house in approving an investment of up to 5% of certain public accounts in a digital asset with more than $500 billion in assets (so far, that’s just Bitcoin). If the Utah senate acts by Friday, the final decision goes to its Republican governor, Spencer Cox, who has supported blockchain policy in the past. If not, Utah’s effort will be put off until another year, and other states like Arizona and Texas could take the spotlight.

President’s Plan

The recent action comes after President Trump on Sunday again discussed his plan for a strategic crypto reserve. Trump said a U.S. strategic crypto reserve could hold XRP, Solana (SOL), and Cardano (ADA), in addition to Bitcoin and Ethereum (ETH), although many details of the effort and how it would be executed remain uncertain.

Criticisms and Concerns

Many industry leaders have criticized Trump’s decision to hold other cryptocurrencies beyond Bitcoin, as it is the one that best fits the characteristics of other reserve assets such as gold. The president, however, has not provided clear guidelines on how such a strategy would work – for example, how the government would source the tokens.

Conclusion

In conclusion, states like Texas and New Hampshire are making progress on plans to invest public money in cryptocurrencies, while others are still in the process of making efforts. The President’s plan for a strategic crypto reserve remains unclear, and many industry leaders have expressed concerns about the inclusion of other cryptocurrencies beyond Bitcoin. As the topic continues to evolve, it will be interesting to see how these plans unfold and what implications they may have on the global cryptocurrency market.

FAQs

• What is the purpose of investing public money in cryptocurrencies? The purpose is to provide a stable store of value and potentially generate returns, similar to other reserve assets like gold and traditional currencies.
• What is the status of the President’s plan for a strategic crypto reserve? The plan is still in development, and many details remain unclear, including how the government would source the tokens and execute the strategy.
• What are the concerns about the President’s plan? Many industry leaders have expressed concerns about the inclusion of other cryptocurrencies beyond Bitcoin, citing its lack of fit with the characteristics of other reserve assets like gold.