New Hampshire State Representative Keith Ammon has introduced groundbreaking legislation that could set a precedent for other states across the US. The bill proposes the creation of a strategic reserve of digital assets with an average yearly market cap exceeding $500 billion. This reserve would include US-pegged stablecoins and would be limited to 10% of the total public funds, equivalent to around $360 million. The bill also emphasizes the use of secure custody solutions to safeguard these assets, ensuring exclusive access to cryptographic private keys and working with qualified custodians and registered exchange-traded products.
Interestingly, the bill specifies that only Bitcoin meets the market cap requirement outlined in the legislation. However, the state treasury could also consider adding stablecoins like Tether USD (USDT) and USD Coin (USDC) to the reserve. Additionally, the proposal allows for investments in traditional precious metals such as gold, silver, and platinum in addition to cryptocurrencies.
One of the most intriguing aspects of the bill is the allowance for staking, even though Bitcoin is the only cryptocurrency currently meeting the criteria. This opens the door for potential future investments in other cryptocurrencies like Ethereum (ETH) and Solana (SOL) if their market caps align with the requirements. The bill also suggests options for lending digital assets, provided the state retains legal ownership and collaborates with third-party providers.
Satoshi Action Fund CEO and co-founder Dennis Porter has voiced support for the bill, noting that the high market cap requirement was included to limit state investment in Bitcoin. He clarified that some states may require tech-neutral bills to reduce political friction, emphasizing the importance of working closely with lawmakers to ensure the bill’s success.
New Hampshire is not alone in its efforts to establish a Bitcoin strategic reserve. Several other states, including Pennsylvania, Texas, Alabama, and Florida, have also initiated similar legislation or proposals. With 10 more US states reportedly preparing to introduce bills focused on Bitcoin strategic reserves in the near future, it seems that digital assets are gaining traction as a viable investment option for state treasuries.
Overall, the introduction of this legislation in New Hampshire marks a significant step towards embracing digital assets as part of state financial strategies. As the crypto landscape continues to evolve, it will be interesting to see how other states follow suit and integrate digital assets into their treasury reserves.