Texas Governor Greg Abbott has signed Senate Bill 21, allowing the state to establish a Bitcoin reserve as part of its financial plan. Texas is now the third U.S. state to recognize Bitcoin as a strategic asset.
Legislation on Bitcoin Reserve
Senate Bill 21, known as the 'Texas Strategic Bitcoin Reserve Act,' was drafted by Senator Charles Schwertner. The law enables the state comptroller to create a Bitcoin reserve to invest in Bitcoin and other approved cryptocurrencies.
Criteria and Management of the Reserve
To qualify for the reserve, assets need to have an average market cap of at least $500 billion over the last 24 months. Currently, only Bitcoin meets this requirement with a market value of over $2 trillion. Ethereum, the second-largest cryptocurrency, does not meet this threshold with a market cap of about $277 billion.
Support for the Law and Its Implementation
The law establishes a five-member advisory committee to manage the reserve, which will include the comptroller and three cryptocurrency investment experts. Before becoming law, SB 21 received strong backing in the Texas Senate, passing with a vote of 25 to 5, and in the House with a 9 to 4 vote. The law will take effect on September 1, 2025.
The signing of Senate Bill 21 by Governor Abbott highlights Texas's commitment to supporting and advancing the use of cryptocurrency in the state's financial systems.
