Nikolas Sargeant
Texas Governor Greg Abbott has officially signed Senate Bill 21, establishing the Texas Strategic Bitcoin Reserve and making Texas the first US state to commit public funds toward holding Bitcoin as a treasury asset. After passing the Texas House in May, the groundbreaking legislation creates a state-managed fund that operates independently from Texas' general treasury system, positioning Bitcoin as part of the state's long-term financial strategy.
The reserve aims to strengthen Texas' financial resilience and serve as a hedge against inflation, with strict eligibility requirements that currently only Bitcoin meets. Assets must have a market capitalization exceeding $500 billion to qualify for inclusion in the fund, ensuring only the most established digital assets are considered. The Texas Comptroller of Public Accounts will administer the fund with guidance from an advisory committee of three cryptocurrency investment professionals.
Beyond direct purchases, the reserve can grow through various mechanisms including Bitcoin forks, airdrops, investment gains, and public cryptocurrency donations. The state will issue comprehensive reports detailing the fund's holdings and performance every two years, ensuring transparency in this pioneering initiative. Additional legislation, House Bill 4488, protects the reserve from being absorbed into the state's general revenue fund.
Texas joins New Hampshire as the second US state to approve Bitcoin reserve legislation, but stands alone in committing public funds and establishing a separate institutional structure. This move reflects growing institutional adoption of Bitcoin, with numerous public companies recently adding cryptocurrency to their treasury holdings. The legislation positions Texas as a leader in state-level cryptocurrency adoption and could influence other states to consider similar measures.
