Arizona Governor Vetoes Bill Allowing Crypto Investments for State Funds

Arizona Democratic Governor Katie Hobbs has vetoed a senate bill that would have made Arizona the first US state to formally adopt a State Bitcoin Reserve. The bill, known as the Arizona Strategic Bitcoin Reserve Act, would have allowed the State Treasurer and retirement systems to invest up to 10% of its public funds in Bitcoin. 

Hobbs justified the move as being necessary to protect the public’s retirement interests and expressed her concerns over exposing state funds to the volatility of the cryptocurrency market. In a letter to Senate President Warren Peterson, Hobbs emphasised that the current strength of the Arizona State Retirement System could be attributed to its history of making “sound and informed investments”.

Arizona’s retirement funds are not the place for the state to try untested investments like virtual currency.

Katie Hobbs, Governor of Arizona

The veto has sparked backlash from both Republican lawmakers and the cryptocurrency community. Republican State Senator Wendy Rogers, who was spearheading the bill, called the move ‘unfortunate’. She resolved to refile the bill in the next session, stating that “Bitcoin doesn’t need Arizona. Arizona needs Bitcoin.”

Investor Anthony Pompliano criticised the decision via X, questioning Hobbs’ understanding of cryptocurrency and her ability to make informed decisions on such issues.

Hobbs’ decision stands in contrast with US President Donald Trump’s move to create a Bitcoin Reserve at the national level in March. President Trump signed an executive order that established a Strategic Bitcoin Reserve and a national stockpile of cryptocurrency for the nation using assets acquired through criminal and civil forfeiture at no extra cost to taxpayers.

Related: Oklahoma Abandons State Bitcoin Reserve Plan After Senate Rebuff

Australia Also Not Ready for a Bitcoin Reserve

The Australian government however is on the same page as Hobbs. Following President Trump’s announcement that the Strategic Bitcoin Reserve was moving forward, a spokesperson for the Australian Government indicated that they have no plans to invest in cryptocurrency at the national level just yet.

While acknowledging that “digital assets present big opportunities for our economy, our financial sector and innovation,” the government remains cautious, focusing on working with regulatory bodies to build a fit for purpose digital asset regulatory scheme to ensure that the sector operates transparently, protects investors, and mitigates risks associated with the cryptocurrency market.

Related: Australia Warns Idle Crypto Firms: “Use It or Lose It”