Arizona Governor Bars State Use of Cryptocurrencies, Regulates Bitcoin ATMs

Arizona Governor Katie Hobbs has vetoed two bills related to the state’s use of cryptocurrencies, reinforcing a cautious approach to the adoption of such assets in government operations.

One of the vetoes was to Senate Bill 1373 , which sought to create a Strategic Digital Asset Reserve Fund. The proposal would allow the state to manage crypto assets obtained through judicial seizures or legislative transfers, with the expectation of investing up to 10% of the fund's total value in a fiscal year. Hobbs justified the veto by saying that the volatility of the cryptocurrency market could expose the general fund to unnecessary financial risk.

It was also rejected the Senate Bill 1024 , which would open the door for state agencies to accept cryptocurrency payments for fees, taxes, and other financial obligations. According to Hobbs, “while this bill would allow state agencies to enter into agreements to protect the state from the risks associated with cryptocurrencies, lawmakers on both sides acknowledged that it still leaves the door open to a lot of risk.”

Despite the rejections, the governor signed Bill 2749 into law, which creates a reserve fund to manage digital assets received by the state through airdrops, staking, and interest income. The text has a budget-neutral structure and avoids directly committing public resources to cryptocurrency investments.

Also in the same legislative session, Bill 2387 was passed, establishing new regulations for cryptocurrency kiosks, also known as Bitcoin ATMs. The new law requires operators to post fraud warnings, provide 24-hour customer support and issue detailed receipts for transactions.

Among the measures, transaction limits were also established: up to US$2.000 per day for new users and US$10.500 for returning customers. In addition, the use of blockchain analysis tools will be mandatory to block wallets suspected of involvement in fraud.

With these decisions, Arizona maintains a regulatory stance that favors the responsible and controlled use of cryptocurrencies, prioritizing the protection of public funds and consumers.