Arizona’s House of Representatives Passes Bills to Establish State Crypto Reserve

The Arizona House of Representatives has passed SB1025 and SB1373 — two bills designed to integrate cryptocurrencies into the state’s investment strategy. The new legislation authorizes public treasury investments in digital assets and provides for the formation of a strategic crypto reserve.

SB1025 introduces amendments to the state’s financial code, allowing up to 10% of treasury holdings to be allocated to digital assets. The bill passed with 31 votes in favor and 25 against. The legislation applies not only to the state’s pension funds but also to other treasury reserves, with a strong emphasis on Bitcoin, although no restrictions are placed on including other cryptocurrencies.

In tandem with the initial bill, lawmakers also passed a second measure — this one aimed at building a strategic digital asset reserve through a separate special fund, insulated from the state’s general budget. The bill received broader support, passing with a 37–19 vote. Both pieces of legislation now rest on the desk of Governor Katie Hobbs, a Democrat, awaiting her signature.

Previously, Governor Hobbs announced her intention to veto any cryptocurrency-related proposals until budget allocations were secured for disability healthcare services. With that funding now officially approved, her position on digital asset legislation may shift. Historically, she rejected a prior bill concerning taxation on Bitcoin mining, referencing concerns about price instability and insufficient regulatory clarity.

With both bills now on her desk, Governor Hobbs can either approve them, reject them, or simply wait out the five-day window—after which they’ll become law by default. Although the legislature retains the option to override a veto with a supermajority, the partisan dynamics make that scenario highly improbable.

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If enacted, these bills would make Arizona the first state in the nation to officially invest state funds in cryptocurrency markets. New Hampshire may soon follow, with a similar bill already moving through its Senate. Federally, President Donald Trump has long championed the idea—going as far as authorizing a strategic Bitcoin reserve, signaling a deeper alignment between Republican leadership and the future of decentralized finance.

The proposed legislation could position Arizona to benefit from long-term gains in the digital asset sector while reducing reliance on traditional financial instruments. Yet, the state must brace for short-term market volatility and the significant costs associated with establishing secure digital infrastructure and maintaining robust cybersecurity.

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Yet, concerns remain about the lack of unified regulation and the complex legal environment surrounding international crypto compliance. But with both bills passed, the direction of Arizona’s digital asset strategy now hinges on the governor’s response.