US States Race to Establish Bitcoin Reserves

Kentucky's Bitcoin Reserves Proposal Sparks Strategic Discussions on BTC Legislation Across US States

Kentucky's recent proposal to establish a Bitcoin reserve has sparked a wave of strategic discussions and legislative actions across various US states, with Utah leading the race to become the first state to create such a reserve. The Utah House Economic Development Committee voted 8-1 in favor of a bill that would allow the state to invest in Bitcoin and other cryptocurrencies, marking a significant step towards embracing digital assets in the state's financial strategy.

Dennis Porter, CEO of Satoshi Action Fund (WA:ACT), expressed confidence in an interview with US Senator Cynthia Lummis that Utah has a "very good shot" at being the first state to establish a Bitcoin reserve. Porter cited the state's short 45-day legislative window and strong political momentum as key factors contributing to this potential outcome. The bill under consideration would allow Utah to diversify a portion of its public funds into Bitcoin, other cryptocurrencies with a market capitalization above $500 billion, and approved stablecoins.

While Utah is at the forefront, Arizona is the only other state that has advanced to a similar stage in the legislative process for establishing a Bitcoin reserve. Other states, including Illinois, Ohio, Massachusetts, New Hampshire, North Dakota, Oklahoma, Pennsylvania, Texas, and Wyoming, have introduced similar bills. Additionally, state officials in Alabama, Florida, Kentucky, and South Dakota have publicly endorsed the idea of a Bitcoin reserve, although no bills have been introduced in these states yet.

On a federal level, Senator Lummis mentioned in the January 21 interview that progress is being made on a Bitcoin reserve bill she introduced, which aims for the US to acquire 1 million Bitcoin over the next five years. The bill would require bipartisan support in the Senate, with at least 60 votes needed for passage. The proposed federal bill outlines various methods for the US to accumulate Bitcoin, including repurposing Bitcoin seized from asset forfeitures and potentially selling a portion of the country's gold reserves.

Asset manager VanEck has suggested that if Bitcoin's price increases at a compounded annual growth rate of 25% and US national debt continues to rise at 5% CAGR, the US could reduce its national debt by 35% by 2049 through strategic Bitcoin investments.