Texas aims to invest in the future of cryptocurrency with Senate Bill 21, which would allow the Texas Comptroller to acquire, sell and buy cryptocurrency to fight inflation. 

If the bill passes, Texas would be one of the first states to create a Bitcoin fund. State Sen. Charles Schwertner, R-Georgetown, filed the bill, which has the support of Lt. Gov. Dan Patrick who included it among his top 40 priority bills of this legislative session.

The comptroller would have the authority to invest at $500 billion in bitcoin and other cryptocurrency, according to SB21. 

Donations of bitcoin would also be included in the management of the reserve along with contracts with qualified providers to assist the reserve. 

The bill, or the Texas Strategic Bitcoin Reserve Act, also creates an advisory committee to help administrate the reserve. Reports from the advisory board would be detailed biennially and available to the public. 

“The state of Texas should have the option of evaluating the best-performing asset of the last ten years,” Schwertner said during a recent Senate Committee on Business and Commerce meeting. “If we continue to spend on the federal level as we are, the dollar will continue to lose purchasing power and people will look to alternatives.”

Questions about the bill arose during the meeting specifically about how private donations to the fund will be handled. 

“It seems to be not free market-oriented when someone essentially somebody with an interest in the industry can put money into this fund which is more or less purchased advertising,” said Sen. Nathan Johnson, D-Dallas.  Johnson explained his position in a statement that read in part: “I have a concern about billionaire tech bros owning branches of government.”

Glen Hegar, Texas Comptroller of Public Accounts, said his office would make the fund “as secure as it could be.” Although nationally bitcoin has seen widespread support, recent volatility of bitcoin price has added to the complications of the fund.

National Level

In addition to Texas, 32 other states have filed similar legislation related to a bitcoin reserve. The race to establish a state bitcoin reserve fund was ignited by a  pledge from the Trump administration to create a national strategic reserve for cryptocurrency. The strategic reserve would act as a stockpile that would be released during times of economic crisis. 

President Donald Trump announced on Truth Social that Bitcoin would be “the heart of the Reserve” Hours after the announcement the market value of bitcoin rose 10% to $94,127.78. This increase is after Friday’s plunge where Bitcoin price went under $80,000. The Bitcoin market’s turbulence has been one of the most concerning elements of the bill. According to the U.S. Treasury Bitcoin has experienced four large price corrects since 2017. 

“Cryptocurrency, much like a lot of different assets that are out there are backed up by the people who have faith and believe in them,” Hegar said about the volatility of Bitcoin.