Texas Creates Bitcoin Reserve, Allocates Public Funds

Texas Governor Greg Abbott has signed into law Bill SB 21, adding Bitcoin reserves to the state’s legal framework. With this move, Texas has become the third state in the U.S. to create an official Bitcoin reserve, following Arizona and New Hampshire. However, Texas is the first state to allocate public funds for this purpose, treating Bitcoin as a long-term strategic asset. The reserve will be managed independently from the general treasury and overseen by the Texas Comptroller, with advice from a three-member crypto investment committee. Only assets with a market cap over $500 billion, currently just Bitcoin, qualify for inclusion in the reserve.

This growing interest in digital asset reserves across the country parallels the policies of Donald Trump, who took office in January 2025. Trump has taken extensive steps to transform the U.S. into a more crypto-friendly environment, including reversing anti-crypto banking practices, appointing pro-crypto figures to key regulatory positions, and establishing a strategic Bitcoin reserve. Trump signed an executive order on March 7, 2025, titled “Establishing a Strategic Bitcoin Reserve and U.S. Digital Asset Stockpile,” formalizing the idea of a Bitcoin-only reserve. The order also defined a “Digital Asset Stockpile,” which would include other digital assets such as XRP, SOL, and ADA. The move clarifies Trump’s idea of a broader digital asset reserve that he had outlined on March 2.

The establishment of the Texas Strategic Bitcoin Reserve signals a growing trend of digital asset adoption at the state level. By committing public funds to a standalone Bitcoin reserve, Texas aims to bolster its financial resilience and hedge against inflation. This strategic move is expected to drive further institutional support for Bitcoin, potentially influencing other states to follow suit. The reserve's independent management and oversight by a dedicated committee ensure that the state's Bitcoin holdings are treated as a long-term financial asset, separate from the general treasury.

The signing of SB 21 into law on June 22, 2025, marks a significant milestone in the adoption of digital assets by state governments. The law protects any future Bitcoin reserves from being absorbed into the state's general fund, ensuring that the reserve remains a standalone entity. This protection is crucial for maintaining the reserve's long-term viability and preventing political interference. The law also establishes a framework for the reserve's management, including the appointment of a three-member crypto investment committee to advise the Texas Comptroller.

The creation of the Texas Strategic Bitcoin Reserve is a bullish sign for Bitcoin, as it represents a significant endorsement of the digital asset by a major U.S. state. The reserve's establishment is expected to drive further institutional support for Bitcoin, potentially influencing other states to follow suit. The reserve's independent management and oversight by a dedicated committee ensure that the state's Bitcoin holdings are treated as a long-term financial asset, separate from the general treasury. This strategic move is expected to bolster Texas's financial resilience and hedge against inflation, making it a model for other states to follow.