Saddle up.
With a stroke of Governor Greg Abbott’s pen, Texas just became the third state in the nation to make cryptocurrency part of its official reserves.
The newly signed legislation, dubbed SB21, authorises the creation of the Texas Strategic Bitcoin Reserve.
It’s a state-managed fund that will allow Texas to purchase and hold Bitcoin outside of its regular treasury system. The reserve is designed to enhance the state’s financial resilience and provide a hedge against inflation, according to the bill text.
Only assets with a market capitalisation above $500 billion qualify for purchase, meaning Bitcoin is currently the sole candidate. The fund can also grow through forks, airdrops, investment gains, and crypto donations from the public.
Administration of the fund falls to the state comptroller, who will oversee Bitcoin custody and work with an advisory committee that includes three crypto investment experts.
A public report will be issued every two years detailing the reserve’s activity and value.
The law’s passage follows Governor Abbott’s recent approval of House Bill 4488, which protects the Bitcoin reserve and other special funds from being absorbed into the state’s general revenue pool.
That financial firewall gives Texas room to manage its Bitcoin holdings independently from budget politics.