PHOENIX — Arizona Gov. Katie Hobbs signed House Bill 2749 into law on Wednesday, establishing a state-managed Bitcoin and Digital Assets Reserve Fund that will hold unclaimed digital assets and staking rewards — five days after she vetoed a separate cryptocurrency bill.
With the signing, Arizona becomes the second state in the U.S. to create a formal framework for holding digital assets.
Bitcoin, the cryptocurrency that emerged from the 2008 financial crisis, uses blockchain technology to support transactions between users.
Detractors call bitcoin speculative, volatile and without intrinsic value. Supporters say it's a new asset class that can be defined as "digital gold," and it's a store of value and a hedge in an ever-increasing supply of global money. Supporters also point to bitcoin's rise in price as the best-performing in history, one that had previously been held back due to regulation — until now.
President Trump has promised to create a strategic bitcoin reserve. He's appointed a crypto czar in David Sacks. Now, individual states are getting involved.
On Tuesday, New Hampshire Gov. Kelly Ayotte signed a bill making her state the first to allow it to invest public funds in crypto reserves.
Recently, the Arizona Legislature approved Senate Bill 1025, which would have allowed the state's retirement fund to invest in virtual currencies such as bitcoin — allowing it to put as much as 10 percent of the state's funds in cryptocurrency.
However, it was vetoed by Hobbs on Friday in order to preserve the strength of the Arizona State Retirement System.
KGUN 9's Jason Barr explains why Hobbs vetoed SB 1025:
In a letter to the Arizona Senate, Hobbs said, "Arizona's retirement funds are not the place for the state to try untested investments like virtual currency."
Several other states are considering a strategic reserve using bitcoin, and the Wisconsin Pension Fund reportedly now includes bitcoin.
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Jason Barr is a sports anchor and reporter for KGUN 9. Jason's stories have won KGUN four prestigious regional Edward R. Murrow Awards for sports reporting. He has also won two Rocky Mountain Emmy Awards for sports reporting. Share your story ideas with Jason by emailing jason.barr@kgun9.com or by connecting on Facebook, Instagram, and Twitter.
