First US Bitcoin Reserve gets approval in Arizona: Uncovering the potential beneficiaries

Key Points

• Arizona is progressing towards becoming the first U.S. state with a Bitcoin reserve.
• Experts anticipate a $23 billion Bitcoin demand if multiple state reserve bills are approved.

Arizona is making significant strides in state-level cryptocurrency investment, following the approval of two landmark bills. These legislations are now waiting for the governor’s approval.

Arizona Approves Bitcoin Reserve

On 22nd April, Senate Bill 1025, also known as the “Arizona Strategic Bitcoin Reserve Act”, was advanced by the Arizona House in a 31-25-4 vote. This bill paves the way for the state to consider Bitcoin (BTC) as a strategic investment asset.

Alongside this, Senate Bill 1373 was passed the same day with a 37-19-4 vote. This bill suggests the establishment of a “Digital Assets Strategic Reserve Fund” to aid in managing digital assets more broadly.

Both bills, having already been approved by the Arizona Senate on 27th February, are now awaiting final approval from Governor Katie Hobbs.

State Representative Jeff Weninger commented on SB1025, stating it allows the treasurer to invest up to 10% into Bitcoin and potentially other assets.

Potential Hurdles

Despite Arizona’s progress towards establishing a Bitcoin reserve, the final decision rests on Governor Katie Hobbs’ approval.

Governor Hobbs has previously stated that she would veto any bill without a bipartisan funding plan to protect healthcare for Arizonians with disabilities. This stance has left many pending proposals in doubt. However, the recent approval of new legislation in both chambers may indicate a shift in the political climate.

If these bills become law, Arizona would be the first U.S. state to set up a Bitcoin reserve, outpacing other states that have recently considered similar initiatives.

New Hampshire is also making progress, with its House Bill 302 moving to a full Senate vote last week after clearing a second Senate committee.

Industry experts like Mathew Sigel, VanEck’s Head of Research, predict that if approximately 20 state-level Bitcoin reserve bills were approved nationwide, they could collectively generate over $23 billion in new demand for Bitcoin.

Despite the increasing interest in state-level Bitcoin reserves, market sentiment around federal action remains cautious. According to Polymarket data, the likelihood of former President Trump establishing a Bitcoin reserve within his first 100 days has dropped sharply to just 2%.

This cautious outlook persists even as Bitcoin continues to rise, recently trading at $94,773.14 after a modest 0.14% gain in the past 24 hours, according to CoinMarketCap.