Virginia advances invoice on state Bitcoin Fund institution committee
Virginia lawmakers are advancing a proposal that may put the commonwealth among the many rising variety of states contemplating direct publicity to Bitcoin and different digital property by means of public reserves.
Senate Invoice 557, sponsored by Sen. Reeves, would set up the Federal Strategic Cryptocurrency Reserve Fund, a particular non-returnable fund held within the state Treasury and administered by the Virginia Secretary of the Treasury.
The invoice superior this week after passing the Senate Common Legal guidelines Technical Committee on a 13-2 vote.
Beneath the invoice, Virginia could be approved to straight make investments state funds in Bitcoin and different eligible digital currencies, making a strategic reserve fund that proponents say is geared toward modernizing monetary administration and positioning the state for the way forward for Bitcoin and digital finance.
The invoice units out an in depth framework for a way Bitcoin reserves might be managed. All funds allotted for this function might be deposited right into a reserve fund together with any Bitcoins or cryptocurrencies bought or acquired.
Notably, the proposal additionally takes under consideration property which may be generated by means of blockchain occasions equivalent to forks or distributed by means of airdrops, guaranteeing that states retain possession of by-product digital holdings.
Not like many state accounts, reserves are usually not recaptured. Which means the funds will stay within the reserve fund reasonably than being returned to the final fund on the finish of every fiscal 12 months.
SB557 contains guardrails meant to restrict speculative publicity. Digital currencies bought utilizing reserves should have a mean market capitalization of at the very least $500 billion over the previous 24 months. This can be a criterion that successfully limits eligibility primarily to Bitcoin.
Treasurers might be required to handle investments primarily based on “prudent individual'' requirements, balancing diversification and threat minimization. The invoice additionally permits the usage of derivatives if the Secretary of the Treasury determines that the derivatives are in one of the best pursuits of the fund.
To deal with safety considerations, the Act authorizes the Secretary of the Treasury to contract with third events, together with certified custodians and controlled liquidity suppliers to facilitate purchases and asset administration, that make use of safe methods equivalent to chilly storage.
The Treasurer might also fee an impartial audit by means of a licensed public accountant.
Moreover, SB557 establishes a five-member Strategic Cryptocurrency Reserve Advisory Board, together with a member with experience in digital asset funding, to supply steerage on valuation methodologies and funding insurance policies.
The invoice requires transparency by means of biennial reporting. By December 31 of every even-numbered 12 months, the Secretary of the Treasury will challenge and submit a report detailing the quantity and estimated worth of Bitcoin and different digital currencies held, their adjustments over time, and any administrative actions taken.
US states settle for Bitcoin
The proposal comes amid rising curiosity from U.S. states and native governments in incorporating digital property into public portfolios, reflecting broader traits in cryptocurrency adoption and monetary innovation.
South Dakota lately launched Home Invoice 1155, which might permit the state to speculate as much as 10% of its public funds in Bitcoin.
Earlier this 12 months, Rhode Island lawmakers launched Senate Invoice S2021, which might briefly exempt small Bitcoin transactions as much as $5,000 per thirty days and $20,000 per 12 months from state revenue and capital features taxes.
The invoice would deal with Bitcoin as a “digital, decentralized forex” that may permit residents and Rhode Island-based companies to self-certify eligibility whereas sustaining easy information.
This exemption will go into impact on January 1, 2027, and expire on January 1, 2028, as a pilot program to cut back tax frictions within the on a regular basis use of Bitcoin.
New Hampshire is one other state that actively helps Bitcoin. In Might 2025, New Hampshire grew to become the primary U.S. state to authorize the Treasury Division to spend money on Bitcoin and different massive digital property by approving the allocation of as much as 5% of sure public funds to cryptocurrencies underneath Home Invoice 302. At the moment, BTC is topic to market capitalization guidelines.
The put up Virginia Advances Invoice with State Bitcoin Fund Institution Committee first appeared in Bitcoin Journal and was written by Micah Zimmerman.
