Texas recently made a multimillion-dollar bitcoin purchase, leading all states in establishing cryptocurrency as a growing component of economic policy.
The $5 million investment into the Texas Strategic Bitcoin Reserve was confirmed last week by the Comptroller’s Office, which is responsible for managing the fund.
The development comes after Gov. Greg Abbott (R-TX) signed legislation creating the reserve in June, making Texas one of the first states in the country to establish a state-managed bitcoin reserve to purchase, hold, and oversee cryptocurrency assets using public funds.
Arizona and New Hampshire have passed laws to create similar strategic funds. But Texas’s $5 million purchase of bitcoin makes it the first state to actually buy a digital currency for its public reserve, according to the Texas Tribune.
“The Texas Legislature passed a bold mandate to create the nation’s first Strategic Bitcoin Reserve,” acting Comptroller Kelly Hancock said in a statement. “Our goal for implementation is simple: build a secure reserve that strengthens the state’s balance sheet. Texas is leading the way once again, and we’re proud to do it.”
The reserve, as created through state Sen. Charles Schwertner’s SB 21, has been billed as a way for Texas to invest in bitcoin and other qualifying crypto assets as a hedge against inflation, economic volatility, and to enhance overall financial resilience. Lawmakers appropriated a total of $10 million during this year’s legislative session for the strategic reserve.
“We can buy land, we can buy gold; I think the state of Texas should have the option of evaluating the best performing asset over the last 10 years,” Schwertner said in February.
Texas Blockchain Council President Lee Bratcher told the Texas Senate Committee on Business and Commerce over the spring that the bitcoin reserve would be saved for emergencies or long-term state financial health.
Under the law, the Texas Bitcoin Reserve may only invest in cryptocurrencies that have had an average market cap of at least $500 billion in the past 12 months — a rule designed to keep the fund focused on stablecoins, a market currently dominated by bitcoin.
The value of bitcoin reached an all-time high this year, as President Donald Trump embraced cryptocurrency, making his the first administration to champion the nascent industry.
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The Trump administration’s Federal Housing Finance Agency ordered Fannie Mae and Freddie Mac in June to develop a proposal considering cryptocurrency as an asset in single-family mortgage loan risk assessments.
“Cryptocurrency is an emerging asset class that may offer an opportunity to build wealth outside of the stock and bond markets,” FHFA Director Bill Pulte wrote.
