Key Takeaways
- South Dakota's HB 1202 proposes allocating 10% of state funds to Bitcoin.
- HCR 6006 urges the State Investment Council to study Bitcoin as an inflation hedge.
- South Dakota is the 13th state to introduce a Bitcoin reserve bill.
On January 30, South Dakota Representative Logan Manhart introduced House Bill 1202 (HB 1202), which would allow the state to allocate up to 10% of its $16.6 billion in public funds to Bitcoin investments.
This would permit a potential Bitcoin purchase exceeding $8 billion.
Custody requirements
Under HB 1202, state-held Bitcoin must be custodied by a qualified institution, such as a federally or state-chartered bank or trust company.
The bill also allows investment through exchange-traded products (ETPs) regulated by the SEC, CFTC, or South Dakota Division of Banking.
Security framework
Security provisions include:
- Multi-party governance structures
- Encrypted storage environments
- Geographically distributed secure data centers for private key management
HCR 6006: Bitcoin study resolution
Manhart also introduced House Concurrent Resolution 6006 (HCR 6006), urging the State Investment Council to study Bitcoin’s potential as a hedge against inflation and economic uncertainty.
The resolution cites Bitcoin’s $1 trillion market capitalization, its growing role in international finance, and the fact that sovereign nations, including the U.S., already hold Bitcoin in reserves.
Growing state adoption
With these bills, South Dakota becomes the 13th U.S. state to propose a strategic Bitcoin reserve.
Other states pursuing similar legislation include Texas, Ohio, Pennsylvania, New Hampshire, and North Dakota.
According to Dennis Porter, CEO of the Satoshi Action Fund, at least 15 states will soon introduce Bitcoin reserve bills, pushing Bitcoin further into mainstream financial policy discussions.
