Texas Legislation for State-Managed Bitcoin Reserve Progresses to Crucial House Reading

Summary

• Texas’s Senate Bill 21, proposing a state-managed Bitcoin reserve, is advancing to a crucial second reading in the House, with a tight deadline for passage before the legislature adjourns on June 2.

• The “Texas Strategic Bitcoin Reserve and Investment Act” would authorize the state to buy, hold, and manage Bitcoin as a strategic financial asset to hedge against inflation and enhance long-term financial resilience.

• Funding for the reserve would come from legislative appropriations, investment earnings, and donations, but strict eligibility criteria currently allow only Bitcoin (>$500B market cap over 12 months) to be acquired.

• If enacted, Texas would become the third U.S. state, following New Hampshire and Arizona, to establish an official Bitcoin reserve, aligning with its crypto-friendly policies.

Legislation proposing the establishment of a Bitcoin reserve under state stewardship in Texas is advancing towards a key second reading in the House of Representatives, a critical phase before it can proceed to a final floor vote.

This development, as indicated on the bill’s official tracking page, moves Texas nearer to potentially creating a government-administered Bitcoin repository.

Critical Timeline and Legislative Hurdles

Dennis Porter, co-founder and CEO of the Satoshi Action Fund, highlighted in a Saturday statement that this upcoming second reading represents an “essential prerequisite” for a conclusive vote.

The urgency is compounded by the Texas legislature’s scheduled adjournment on June 2, leaving a limited timeframe for the bill’s passage.

Should Senate Bill 21 (SB 21) fail to secure approval by this deadline, it would effectively be nullified and necessitate reintroduction in a subsequent legislative session.

If SB 21 successfully navigates this reading within the House, it is anticipated to move expeditiously to a third reading and a final vote on the House floor.

Upon passage, the bill would then be presented to the governor for signature into law.

The proposed legislation has already surmounted two significant legislative hurdles.

It received approval from the Texas Senate with a 25–5 vote on March 6 and subsequently passed through the House Committee on May 7 with a 9–4 vote, without any amendments.

Details of the Proposed Bitcoin Reserve Act

Entitled the Texas Strategic Bitcoin Reserve and Investment Act, SB 21 was authored by Senator Charles Schwertner and is sponsored in the House by Representative Giovanni Capriglione.

The act would empower the state to acquire, hold, and manage Bitcoin as a component of a government-operated reserve.

This initiative aims to treat Bitcoin as a strategic financial instrument, one that could potentially act as a safeguard against inflation and economic instability, thereby enhancing the state’s long-term fiscal resilience.

Funding for this reserve is envisioned to come from various sources, including legislative appropriations, earnings from investments, and voluntary contributions from Texas citizens.

The reserve would also encompass any Bitcoin or other qualifying digital currencies obtained through events such as forks or airdrops.

Strict Eligibility and Potential National Precedent

However, the bill imposes strict criteria for eligibility: any digital asset procured for the reserve must have consistently maintained a market capitalization of at least $500 billion over the preceding 12 months.

Currently, Bitcoin is the only digital asset that meets this threshold.

If this legislation is enacted, Texas would follow New Hampshire and Arizona in becoming the third U.S. state to formally institute a Bitcoin reserve.

This aligns with Texas’s broader existing policies that are generally considered favorable to cryptocurrency.

New Hampshire recently established a precedent, becoming the first U.S. state to create a strategic Bitcoin reserve following the passage of House Bill 302 (HB 302) on May 6.

Also Read: Texas Pioneers First Bitcoin Reserve Bill

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