State Bitcoin Reserve Plans Face Rejection Spree, but Lawmakers Still See a Path Forward

Key Takeaways

• The effort to establish state-level Bitcoin reserves has faced setbacks in some U.S. states.
• Several states are still in the process of establishing the first state-backed Bitcoin reserve.
• Lawmakers in several states vowed to revisit the Bitcoin reserve proposal in future sessions.

A nationwide push to establish state-level Bitcoin reserves has gained momentum, with nearly half of U.S. states proposing legislation to invest in BTC.

Inspired by Donald Trump’s endorsement of a national Bitcoin reserve, lawmakers in 24 states introduced bills to allocate public funds toward Bitcoin or Bitcoin-backed investment products.

Despite the growing interest, resistance remains.

Six U.S. States Reject Bitcoin Reserve Proposal

Over the past few weeks, at least six states have voted down their respective Bitcoin reserve bills, citing concerns over financial risks, regulatory uncertainty, and the use of taxpayer money.

Meanwhile, 18 states have advanced the legislation, keeping the race alive to become the first state to hold Bitcoin as a strategic reserve asset.

Montana

Montana’s Bitcoin reserve proposal, introduced on Jan. 31, aimed to invest up to $50 million in Bitcoin, digital assets, stablecoins, or precious metals.

However, House Bill 429 failed its second reading, with 59 lawmakers voting against it and only 46 in favor.

Fiscal conservatives opposed using general funds for what they deemed “speculation with taxpayer dollars.” A proposed amendment to fund the initiative with interest from ARPA funds also failed.

South Dakota

South Dakota’s Bitcoin reserve bill, HB 1202, sought to allocate up to 10% of state funds to Bitcoin, held through a secure custody solution. However, the House Commerce and Energy Committee rejected the bill in a 9-3 vote on Feb. 24.

North Dakota

North Dakota took a more cautious approach, introducing a resolution on Jan. 10 to study the feasibility of a Bitcoin reserve.

While it did not call for immediate investments, the study was seen as a stepping stone toward a formal reserve.

The measure, HB 1184, failed to pass the House, with 57 votes against and 32 in favor.

Pennsylvania

Pennsylvania was an early adopter in the Bitcoin reserve discussion, introducing its bill in November 2024.

HB 266 proposed investing up to 10% of the state’s general, investment, and rainy-day funds in Bitcoin.

However, the bill failed to pass the House of Representatives and was effectively dead by Feb. 25.

Wyoming

Wyoming’s Bitcoin reserve bill, introduced on Jan. 18 and backed by five Republican senators, sought to have the state treasurer invest public funds exclusively in Bitcoin.

Unlike other proposals, it excluded stablecoins and other digital assets.

However, the state committee rejected the bill on Feb. 6, halting its progress.

Mississippi

Mississippi introduced HB 1590 on Feb. 4, aiming to allocate a portion of public funds to Bitcoin.

The bill was short-lived, failing to pass the committee by Feb. 17.

The Bitcoin Reserve Dream Isn’t Over

Despite these setbacks, lawmakers in multiple states plan to reintroduce Bitcoin reserve bills in future sessions. Some plan to refine their legislative approach, addressing concerns raised in the initial debates.

Meanwhile, 18 states are still in the process of establishing the first state-backed Bitcoin reserve. Arizona and Oklahoma currently lead the race, having cleared key legislative hurdles, including committee approvals and floor votes.

At the national level, the odds of a federal Bitcoin reserve have also improved.

The 2024 elections ushered in a more Bitcoin-friendly Congress, with two additional pro-Bitcoin senators and 13 more House representatives.

With a more pro-Bitcoin Congress in place, the prospect of a federal Bitcoin reserve is gaining traction.