Arizona Takes Landmark Step to Establish First State-Level Bitcoin Reserve with New Legislation

Arizona has taken a significant step towards establishing what could become the United States’ first state-level Bitcoin reserve. The state’s legislature recently passed two pivotal bills aimed at allowing a portion of public funds to be allocated for investments in Bitcoin and other digital assets. These legislative measures now await the approval of Governor Katie Hobbs, who will have the final say on whether they become law.

On April 28, the Arizona House of Representatives voted in favor of Senate Bill 1025 (SB1025) and Senate Bill 1373 (SB1373). SB1025, which proposes the establishment of a strategic Bitcoin reserve, garnered 31 votes in favor and 25 against. Meanwhile, SB1373, which aims to create a broader digital asset reserve, passed with a more substantial majority, securing 37 votes in favor while 19 were opposed. These developments signal a progressive shift toward embracing cryptocurrency within government financial strategies.

State Representative Jeff Weninger, a key advocate for these bills, stated that the legislation permits up to 10.5% of public funds to be invested in Bitcoin and potentially other cryptocurrencies. He indicated that this investment would likely commence as an option rather than a mandate, emphasizing a cautious approach as the state navigates this new financial landscape.

Arizona’s proactive stance positions it ahead of other states that are currently contemplating similar legislation. Should Governor Hobbs sign the bills into law, Arizona would proclaim itself as the pioneering state to officially incorporate Bitcoin into its strategic asset management framework. This move has not been without its critics, notably economist Peter Schiff, who has raised concerns over the viability of such investments.

The governor faces intense scrutiny regarding her position on the bills. Although she previously expressed opposition to signing any legislation until a resolution on disability funding was achieved, the recent legislative progress has prompted increased pressure from lawmakers and advocates for the Bitcoin reserve initiative. Governor Hobbs must now balance these competing priorities as she considers the potential implications of allowing Arizona to invest in digital currencies.

In anticipation of the government’s decision, Dennis Porter, CEO of the Satoshi Action Fund, has urged American voters to rally support for strategic Bitcoin reserves. He emphasizes the importance of following through with legislative processes that encourage innovation in financial management, particularly concerning Bitcoin and other cryptocurrencies.

Porter’s assertions reflect a broader sentiment among proponents of cryptocurrency. Supporters argue that Bitcoin investments hold the potential to serve as a hedge against inflation and other economic uncertainties that have plagued traditional markets. The interest in institutional adoption of cryptocurrencies is gradually gaining momentum, suggesting a shifting paradigm in how state assets might be managed.

Globally, however, trends indicate a reduction in government-held Bitcoin reserves. According to a recent report by CoinGecko published in April 2025, the total collective Bitcoin reserves held by governments decreased from approximately 529,591 BTC in July 2024 to around 463,741 BTC. This decline highlights the complex landscape of cryptocurrency regulation and adoption that varies greatly by region.

The United States remains the largest government holder with over 198,500 BTC, despite recent liquidations of certain assets. Following the U.S. is China, which holds approximately 194,000 BTC, mainly acquired from the seizure of the 2019 PlusToken Ponzi scheme’s assets. The United Kingdom, meanwhile, has accumulated around 61,500 BTC, primarily through criminal confiscations, while Bhutan’s Bitcoin holdings have reached a notable 8,500 BTC through mining activities.

Meanwhile, in a stark contrast, El Salvador continues its aggressive Bitcoin accumulation policy under the leadership of President Nayib Bukele, now boasting 6,195 BTC with plans for daily purchases of Bitcoin to bolster its national reserves.

In the corporate world, Bitcoin interest remains robust as well. MicroStrategy has recently announced an acquisition of 15,485 BTC, valued at approximately $1.43 billion. This latest purchase brings the company’s total Bitcoin holdings to over 554,000 BTC, which is now valued at around $52.8 billion, underscoring the confidence some organizations have in the digital currency market.

As Arizona continues to position itself as a potential trailblazer in the acceptance of cryptocurrency at a government level, the decision from Governor Hobbs will be closely watched by both supporters and critics alike. The outcome could set a precedent for other states considering similar legislative actions and further drive the conversation surrounding the role of cryptocurrencies in public finance. With an evolving economic ecosystem where traditional and digital assets coexist, the implications of Arizona’s decision may ripple well beyond its borders.