Arizona Governor Rejects Bitcoin Reserve Bill Again

Arizona Governor Katie Hobbs has vetoed another Bitcoin (BTC) reserve bill. House Bill 2324 sought to establish a ‘Bitcoin and Digital Assets Reserve Fund’ funded by criminal asset forfeiture.  

This marks the third veto of a digital asset reserve bill in the current legislative session, highlighting a cautious approach to incorporating cryptocurrency into the state’s financial framework.

Arizona’s Bitcoin Reserve Bill Dies After Governor Hobbs’ Veto

BeInCrypto reported that the bill initially failed a final House vote in early May. Nonetheless, lawmakers revived it in late June, and it passed a Senate Vote. On June 24, HB 2324 cleared the House with a 34-22 vote.

However, the bill is now officially dead with Governor Hobbs’ veto. In her veto letter, addressed to House Speaker Steve Montenegro, she cited concerns over the legislation’s impact on local law enforcement. 

“Today, I vetoed House Bill 2324. This bill disincentives local law enforcement from working with the state on digital asset forfeiture by removing seized assets from local jurisdictions,” the letter read.

This veto follows the rejection of two earlier bills, Senate Bill 1025 and Senate Bill 1373. The former aimed to permit the state to invest up to 10% of its public funds in Bitcoin or other digital assets.

SB 1373 proposed funding the Digital Assets Strategic Reserve Fund with digital assets seized by the state, additional funds appropriated by the Arizona Legislature, and permitted further state investments. Besides the reserve bills, Governor Hobbs also vetoed Senate Bill 1024. This would have allowed state agencies to accept cryptocurrency for payments such as fines, taxes, and fees.

Despite these vetoes, Arizona has not entirely abandoned the concept of digital asset reserves. HB 2749, signed into law on May 7, establishes a reserve funded by unclaimed property, including virtual currencies, airdrops, and staking rewards. 

This bill does not authorize direct investment in cryptocurrencies. Still, it represents a compromise that avoids using state funds while still integrating digital assets into public finance. This aligns with her administration’s conservative approach to managing taxpayer money.

Meanwhile, Connecticut has adopted a more stringent stance. On June 30, Governor Ned Lamont signed a bill into law that prohibits the state and its subdivisions from accepting virtual currency for payments or from purchasing, holding, investing in, or creating digital asset reserves.

While opposition exists, the momentum for state-level Bitcoin reserves is still strong. According to the latest data from Bitcoin Laws, there are currently 17 active bills across eight different states. This indicates that, despite resistance, there is continued interest and effort in establishing Bitcoin reserves at the state level.