Key Takeaways
- Arizona Governor Katie Hobbs vetoed a bill to create a state Bitcoin reserve.
- The bill had bipartisan support and was the first of its kind to pass both chambers in a U.S. state.
- A separate bill to allow Arizona to retain seized Bitcoin remains under review.
Governor Katie Hobbs of Arizona has vetoed Senate Bill 1025, a proposal that would have created the first state-backed Bitcoin reserve in the U.S.
The bill, which had passed both chambers of Arizona’s legislature with bipartisan support, was struck down on May 2.
Concerns over Bitcoin’s volatility
In a letter to Senate President Warren Petersen, Hobbs criticized the plan, citing concerns about Bitcoin’s volatility and its unsuitability for state retirement funds.
She wrote:
The Arizona State Retirement System is one of the strongest in the nation because it makes sound and informed investments. Arizonans’ retirement funds are not the place for the state to try untested investments like virtual currency.
Historic rejection of Bitcoin reserve initiative
This marks the first time a sitting U.S. governor has formally rejected a strategic Bitcoin reserve initiative.
Other digital asset bills under review
Senate Bill 1025 was one of two digital asset bills under Hobbs’ review.
The other, Senate Bill 1373, would allow Arizona to retain and lend out Bitcoin obtained through legal seizures.
Its status remains unclear following the governor’s rejection of SB 1025.
Stalled Bitcoin reserve efforts in other states
Arizona joins Oklahoma, Montana, North Dakota, and Wyoming, where similar Bitcoin reserve efforts have stalled.
Federal level developments
Meanwhile, New Hampshire’s proposal has advanced past committee and awaits a full vote.
On the federal level, Senator Cynthia Lummis is pushing the BITCOIN Act, a bill that would allow the U.S. to acquire up to 1 million BTC over five years.
Lummis thanked President Trump for his support, stating:
The BITCOIN Act is the only solution to our nation’s $36T debt.
