Texas lawmakers have introduced a bill to create a state-level strategic bitcoin reserve, a move that could serve as a testing ground for a similar initiative at the national level. Republican State Representative Giovanni Capriglione announced the legislation during an X Spaces event on Thursday.
The bill proposes that Texas accept tax payments, fees, and donations in bitcoin, holding the cryptocurrency for a minimum of five years. This reserve, according to Capriglione, aims to bolster the state’s financial stability and position Texas as a leader in bitcoin innovation. He argued that such a reserve would be a “win-win” for the state, citing bitcoin as a hedge against inflation.
While the initial proposal doesn’t include a direct bitcoin purchasing strategy, Capriglione expressed his intention to broaden the bill’s scope with support from other legislators. Texas, boasting the second-largest economy in the US and the highest concentration of bitcoin miners, hopes to encourage these miners to pay taxes in cryptocurrency.
This move comes amid growing calls for a national strategic bitcoin reserve, a concept championed by former President Donald Trump during his campaign. Bitcoin’s recent rally, exceeding 45%, is partly attributed to investor optimism surrounding the potential establishment of such a reserve.
While some analysts remain skeptical about the likelihood and impact of a national bitcoin reserve, the idea has generated significant market excitement. Needham analyst John Todaro, while acknowledging the potential market boost, downplayed the likelihood of substantial price gains due to limited government bitcoin purchases.
Texas isn’t alone in exploring this frontier. Pennsylvania introduced a similar bill last month, and several other states and countries are reportedly considering similar legislation. Dennis Porter, who collaborated with Capriglione on the Texas bill, has also assisted lawmakers in other states on bitcoin-related legislation. Several states, including Oklahoma, Louisiana, Montana, and Arkansas, have already enacted laws to protect various aspects of cryptocurrency activity, such as mining and self-custody.
Former President Trump publicly endorsed the concept of a national strategic bitcoin reserve at the Bitcoin 2024 conference in Nashville, pledging to retain all bitcoin acquired by the US government. At the same event, Wyoming Senator Cynthia Lummis unveiled her BITCOIN Act, designed to create such a reserve.
