Main Points:
- Historic Legislation Passed: On June 20, 2025, Governor Greg Abbott signed SB21 into law, creating the Texas Strategic Bitcoin Reserve.
- Fund Structure: A separate fund, managed by the Texas Comptroller’s office, will initially allocate $10 million (~¥1.65 billion) to Bitcoin, and may accept private donations.
- Investment Criteria: Only digital assets with a 12-month average market cap above $500 billion qualify—currently only BTC.
- Growing U.S. Trend: New Hampshire, Arizona, and Texas have enacted similar bills; over 40 states have proposed or are considering crypto reserve legislation, while Connecticut has banned such investments.
- Strategic Rationale: Texas aims for inflation hedging, portfolio diversification, and support for blockchain innovation.
Introduction
In a landmark move, Texas has become one of the first U.S. states to formally adopt cryptocurrency as part of its official reserves. Senate Bill 21 (SB21), known as the Texas Strategic Bitcoin Reserve and Investment Act, was approved by the legislature and signed by Governor Greg Abbott on June 20, 2025. This law empowers the state to invest in Bitcoin as a strategic asset, marking a shift in public finance strategy toward digital assets. SB21 not only institutionalizes Bitcoin holdings but also establishes a blueprint for other states contemplating similar measures.
What Is a Strategic Bitcoin Reserve?
A Strategic Reserve traditionally refers to funds or commodities that governments hold to stabilize markets or hedge against economic downturns. Historically, these reserves were denominated in cash, government bonds, gold, or strategic raw materials. SB21’s innovation lies in designating Bitcoin—often called “digital gold”—as a reserve asset due to its limited supply and potential as an inflation hedge. By requiring a minimum market capitalization of $500 billion (of which Bitcoin is currently the sole candidate), the law ensures only highly liquid, established assets are chosen.
Key Provisions of SB21
1. Texas Strategic Bitcoin Reserve Fund
- Independent Structure: The fund is separate from the general treasury, overseen by the Texas Comptroller of Public Accounts (currently Glenn Hegar).
- Initial Allocation: $10 million (approx. ¥1.65 billion at $1=¥165) in public funds is earmarked for Bitcoin purchases.
- Private Donations: Texas residents can donate funds or even Bitcoin itself to bolster the reserve.
- Compounding Returns: Any investment income (e.g., BTC price appreciation) remains in the fund to compound over time.
- Transparency: Quarterly reports and annual audits ensure public accountability, though HB4488 exempts the fund from certain routine fiscal audits to protect long-term holdings from forced liquidation.
2. Investment Authority
- The Comptroller may invest in digital assets meeting the market-cap threshold (currently only Bitcoin).
- Provisions guard against unauthorized transfers, preventing fund “leakage” into the general revenue stream.
Why Texas Chose Bitcoin
Inflation Hedge: With U.S. inflation peaking at over 7% in 2021, holding cash erodes purchasing power. Bitcoin’s capped supply of 21 million coins offers a potential store of value against fiat devaluation.
Portfolio Diversification: In line with modern portfolio theory—“don’t put all your eggs in one basket”—Texas pioneers a multi-asset reserve including cash, bonds, commodities, and now Bitcoin.
Support for Blockchain Innovation: As home to significant Bitcoin mining operations, Texas benefits from the blockchain ecosystem’s growth. Early adoption may attract further investment in infrastructure, developers, and regulatory leadership.
Trend Among U.S. States
A wave of state-level crypto reserve proposals has swept the country in 2025.
- Passed: New Hampshire (HB302, May 7), Arizona (HB2749), and Texas (SB21) now authorize state Bitcoin or digital asset reserves.
- Under Discussion: Over 40 states have introduced or are reviewing legislation to hold digital assets in strategic funds; these include Pennsylvania, Ohio, and Kentucky.
- Banned: Connecticut’s HB7082 prohibits state and local entities from investing in or holding any cryptocurrency, effective October 1, 2025.
The following chart illustrates the current status across the U.S.:
(See the interactive table and bar chart above for “US State Bitcoin Reserve Status Overview”.)
Potential Market Impact
Positive Effects:
- Institutional Legitimacy: State adoption may prompt other public and private institutions to consider Bitcoin for strategic reserves.
- Demand Surge: Direct state purchases, alongside signaling effects, could support Bitcoin’s price stability and growth.
- Regulatory Clarity: Clear legal frameworks reduce uncertainty for crypto businesses and investors.
Risks and Considerations:
- Volatility: Bitcoin’s notorious price swings could expose the fund to rapid valuation changes.
- Regulatory Shifts: Future federal policy could override state-level initiatives.
- Political Risk: Changes in administration or legislative priorities may alter reserve mandates.
A Practical Guide for Crypto Investors
For readers exploring new crypto assets or blockchain applications:
- Learn the Basics: Understand on-chain fundamentals, market-cap metrics, and the role of reserves in macro portfolios.
- Choose a Platform: Use reputable Japanese exchanges like CoinCheck, bitbank, or SBI VC Trade for Bitcoin and large-cap altcoins.
- Risk Management: Allocate only a small percentage of your portfolio to crypto—and consider tools like dollar-cost averaging.
- Stay Informed: Follow state-level policy shifts; state purchases can signal institutional demand trends.
- Explore Utility: Investigate DeFi lending, staking, and blockchain integration opportunities in supply chain or finance.
Conclusion
Texas’s enactment of SB21 marks a watershed moment in public finance, integrating Bitcoin into official reserves for the first time at the state level. As New Hampshire, Arizona, and others follow suit—while Connecticut and a few outliers opt-out—the U.S. is witnessing a dynamic policy landscape. For investors and blockchain practitioners, these developments underscore the maturing role of digital assets in institutional strategies and highlight new avenues for innovation and revenue generation. Whether Bitcoin fulfills its promise as “digital gold” will depend on market resilience, regulatory harmony, and sustained adoption—but the Texas reserve is a bold step toward that future.
