Texas Becomes First U.S. State to Publicly Fund Bitcoin Reserve Under New Law

On June 21, 2025, Texas Governor Greg Abbott signed Senate Bill 21 (SB 21) into law, establishing the Texas Strategic Bitcoin Reserve and positioning the state as a trailblazer in cryptocurrency adoption.

This landmark legislation, authored by State Senator Charles Schwertner and championed in the House by Representative Giovanni Capriglione, makes Texas the third U.S. state — following New Hampshire and Arizona — to recognize Bitcoin as a strategic asset.

"We can buy land, we can buy gold; I think the state of Texas should have the option of evaluating the best performing asset over the last 10 years," Schwertner said in February, highlighting the rationale behind the bill.

Unlike its predecessors, Texas is the first to commit public funds to an independent Bitcoin reserve, a move hailed as a bold step toward financial resilience.

The law restricts investments to cryptocurrencies with a market capitalization exceeding $500 billion over the past 12 months or $600 billion over 24 months, a threshold currently met only by Bitcoin.

The reserve, managed by State Comptroller Glenn Hegar, operates independently of the state’s general treasury, safeguarding it from budgetary reallocations. House Bill 4488, signed concurrently, reinforces this protection by shielding the reserve from “fund sweeps” that could divert assets to other state priorities.

Lee Bratcher, president of the Texas Blockchain Council, described the initiative as a “prudent investment vehicle,” predicting an initial allocation of tens of millions of dollars.

Governance, Security, and Funding Mechanisms of the Bitcoin Reserve

SB 21 outlines a robust framework for the Bitcoin reserve. The fund can grow through forks, airdrops, investment returns, or public cryptocurrency donations.

To maintain public trust, the law mandates biennial reports detailing the reserve’s performance and holdings, offering transparency to taxpayers.

Security measures include cold storage technology to protect assets from cyber threats, a critical feature given the reserve’s high-profile status.

The bipartisan support for SB 21 reflects Texas’ ambition to lead in the cryptocurrency space. The law’s passage aligns with broader national trends, Governor Abbott, a long-time advocate for blockchain innovation, has positioned the state as a hub for crypto-friendly policies, attracting businesses and investors.

Broader Implications: Texas’ Role in U.S. Crypto Adoption Landscape

New Hampshire passed its Bitcoin reserve law on May 6, 2025, while Arizona followed suit earlier in the year.

However, states like Florida and Montana have rejected similar proposals, citing volatility concerns.

The Texas Strategic Bitcoin Reserve could redefine state-level financial strategies, setting a precedent for others to follow.