Arizona Signs Bill to Manage Unclaimed Crypto Assets, Technically Establishing First State Crypto Reserve

On May 7, 2025, Arizona Governor Katie Hobbs signed House Bill 2749 into law, technically creating the state’s first cryptocurrency reserve to manage unclaimed digital assets, airdrops, and staking rewards. As reported by Bitcoin Law, the legislation authorizes the Arizona State Treasurer to hold these assets in a custodial capacity but explicitly prohibits investment activities.

Details of HB 2749

HB 2749 amends Arizona Revised Statutes to create the Bitcoin and Digital Assets Reserve Fund, administered by the State Treasurer. The fund holds unclaimed digital assets, including Bitcoin and other cryptocurrencies, along with staking rewards, airdrops, and interest earned. After three years, unclaimed assets held by qualified custodians—entities licensed in Arizona to sell and custody digital assets—are transferred to the fund. The bill allows up to 10% of non-Bitcoin digital assets to be deposited into the state’s general fund with legislative approval, while Bitcoin holdings remain exempt from such transfers. All monies in the fund are subject to legislative appropriation, ensuring oversight.

Legislative Context and Significance: SB 1025 Veto and SB 1373’s Pending Status

The passage of HB 2749 follows debates over two related bills: Senate Bill 1025 and Senate Bill 1373. SB 1025 proposed allowing the State Treasurer and Arizona State Retirement System to invest up to 10% of public funds in Bitcoin. It passed the Senate on February 27, 2025 (17-11) and the House on April 28, 2025 (31-25) but was vetoed by Governor Hobbs on May 2, 2025. In her veto letter, Hobbs stated, “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.” The veto prompted criticism from crypto advocates. David Bailey, CEO of Bitcoin Magazine, posted on X, “Impeach Katie Hobbs, she just screwed over Arizona.”

SB 1373 proposes a Digital Assets Strategic Reserve Fund using legislative appropriations and seized digital assets. It allows up to 10% of the fund to be invested or lent to generate returns without increasing financial risk. As of May 8, 2025, SB 1373 awaits Hobbs’ decision.

The signing of HB 2749 is significant for Arizona, as it indicates Governor Hobbs’ willingness to enact cryptocurrency-supportive legislation despite her earlier veto of Senate Bill 1025. Previously, Hobbs had stated she would not approve new legislation until the state legislature passed a bipartisan funding solution to protect healthcare for Arizonans with disabilities. The approval of HB 2749 suggests progress on this front or a shift in her stance.

The passage of HB 2749 has also renewed confidence in the potential approval of Senate Bill 1373. However, while HB 2749 technically establishes a state-level Bitcoin reserve, it only grants the government authority to manage unclaimed digital assets and does not permit investment activities related to Bitcoin or other cryptocurrencies. Consequently, the investment-focused SB 1373 faces challenges due to Hobbs’ cautious approach to crypto investments.

State Strategic Bitcoin Reserve Bills Race

Arizona’s HB 2749 aligns with emerging state-level crypto policies. On May 6, 2025, New Hampshire signed House Bill 302, the first state-level Bitcoin reserve bill, authorizing its treasurer to invest up to 5% of public funds in digital assets with a market capitalization exceeding $500 billion (currently only Bitcoin). The law will take effect in July 2025, and the New Hampshire State Treasury will begin operating the digital asset reserve. The implementation of New Hampshire’s Bitcoin reserve bill is expected to influence the decisions of Arizona, Texas, North Carolina, Alabama, and many other states still considering Bitcoin reserve legislation.