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Utah’s “Bitcoin Reserve Bill” Passes Preliminary Senate Review
Bitcoin is the Only Digital Asset Meeting Reserve Standards
If Passed, the Bill Will Take Effect on May 7
Utah’s Bitcoin Reserve Bill passed the state’s Senate Revenue and Taxation Committee on February 20, bringing Bitcoin one step closer to becoming a reserve asset for the state. The bill, titled HB230 “Blockchain and Digital Innovation Amendments,” was approved by the committee with a vote of 4 in favor, 2 against, and 1 absent. The bill will proceed to a second and third review before a final vote. Previously, the bill had passed in the House of Representatives. If approved by the Senate, Utah Governor Spencer Cox will only need to sign the bill to officially include Bitcoin (BTC) as a state reserve asset. In this vote, all four senators who supported the bill were Republicans, while the opposing votes came from one Republican senator and one Democratic senator, with one senator absent.
Bitcoin is the Only Digital Asset Meeting Reserve Standards
According to the bill’s provisions, for a digital asset to become a reserve asset in Utah, it must have an average market capitalization of over $500 billion within the past year. Currently, Bitcoin is the only digital asset that meets this criterion. Ethereum (ETH), the second-largest cryptocurrency by market capitalization, briefly exceeded $500 billion in 2021 but only maintained that level for a few months (from October to December 2021). Additionally, the bill authorizes the state treasurer to engage in cryptocurrency staking, which, while not applicable to Bitcoin, opens the possibility for cryptocurrencies using PoS (Proof of Stake) mechanisms, such as Ethereum, to be included as reserve assets in the future. According to the bill, the state treasurer may invest up to 5% of digital assets in five state funds, including:
General Fund Budget
Income Tax Fund Budget
State Disaster Recovery Accounts, etc.
These funds must be held in qualified custodians or through exchange-traded funds (ETFs). If the bill is ultimately passed and signed by the governor, it will take effect on May 7, 2024.
If Passed, the Bill Will Take Effect on May 7
Currently, Utah is leading the nation in the progress of Bitcoin reserve legislation. Dennis Porter, CEO of the Satoshi Action Fund, recently stated that due to Utah’s shorter legislative cycle and stronger political momentum, the state could become the first in the U.S. to adopt Bitcoin reserves. According to information from the Bitcoin Reserve Monitor, 13 other states, including Arizona, Illinois, Kentucky, Maryland, Montana, New Hampshire, New Mexico, North Dakota, Ohio, Oklahoma, Pennsylvania, South Dakota, and Texas, have also proposed similar Bitcoin reserve bills. Among these, Utah and Arizona are ahead of the other states. Reference source
