Pennsylvania's Bitcoin Strategic Reserve Act could allocate $7 billion to diversify state investments.
The bill faces challenges in Pennsylvania's closely divided House, but enjoys bipartisan support.
If passed, Pennsylvania would be the first state to hold Bitcoin directly on its balance sheet.
The Pennsylvania lawmakers have proposed the Bitcoin Strategic Reserve Act in response to the increasing bitcoin demand in the US. Much like current legislation, the bill stipulates that the state treasury can invest not more than 10% in Bitcoin. This could amount to approximately $7 billion.
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Republican Representative Mike Cabell, the author of the bill, has proposed Bitcoin as a hedge against inflation. He stated that through the use of Bitcoin, the state would be able to hedge in the volatile markets and also diversify investment instruments with an exclusion of bonds.
Challenges and Support for the Bill
The bill may still experience challenges in the legislature. The House in Pennsylvania has the Democratic party with a very slim majority of 102 to 101. Nevertheless, there is a clear tendency of bi-partisan crypto legislation support today. Both Republicans and Democrats see Bitcoin’s role in diversifying state assets.
If the bill passes, Pennsylvania will join other pro-crypto states like Wyoming, Texas, and Florida. Wyoming has passed over 20 blockchain-related laws since 2018. Texas has positioned itself as a major hub for crypto mining. Florida continues to develop strategies to attract blockchain companies.
The Pennsylvania Bitcoin Strategic Reserve Act has received attention across the nation. The people who approved the bill think that it may be the start of other states also implementing similar legislation. It would be the first state in the country to take Bitcoin on its balance sheet if the bill is approved. This would signal a shift in how state governments approach digital assets.
The potential approval of this bill could pave the way for future state-level crypto investments. Other states may look to Pennsylvania as a model for integrating digital currencies into government reserves. This move would also highlight Bitcoin’s growing role in state-level financial strategies.
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