By: Capriglione H.B. No. 1598
A BILL TO BE ENTITLED
AN ACT
relating to the establishment of a bitcoin reserve within the state
treasury and the management of cryptocurrencies by governmental
entities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. This Act may be cited as the Texas Strategic
Bitcoin Reserve Act.
SECTION 2. Chapter 403, Government Code, is amended by
adding Subchapter U to read as follows:
SUBCHAPTER U. TEXAS STRATEGIC BITCOIN RESERVE
Sec. 403.701. DEFINITIONS. In this subchapter:
(1) "Bitcoin" means the decentralized digital asset
created by a peer-to-peer network, which operates with no central
authority or banks.
(2) "Cold storage" means a method of storing private
keys required to transact in Bitcoin, with a nexus to a secure
physical location, protected from unauthorized access and isolated
from any network connections.
(3) "Cryptocurrency" means a type of virtual currency
that utilizes cryptography to secure transactions that are
digitally recorded on a distributed ledger, such as a blockchain.
(4) "Custody" means the holding, safeguarding, and
managing of Bitcoin assets by the state treasury.
(5) "Donor" means a Texas resident who gifts, grants,
donates, bequests, or devises Bitcoin to the Texas Strategic
Bitcoin Reserve.
Sec. 403.702. LEGISLATIVE FINDINGS. The legislature finds
that:
(1) the legislature recognizes Bitcoin as a valuable
digital asset with strategic potential for enhancing the state's
fiscal resilience;
(2) Bitcoin's decentralized nature and finite supply
provide unique qualities that can serve as a hedge against
inflation and economic volatility; and
(3) A strategic Bitcoin reserve aligns with Texas's
commitment to fostering innovation in digital assets and providing
Texans with enhanced financial security.
Sec. 403.703. PURPOSE. This fund allows the state to own
Bitcoin as a financial asset and for Texans to voluntarily donate
Bitcoin to promote a shared ownership and community investment in
Texas's financial future.
Sec. 403.704. ADMINISTRATION OF RESERVE. (a) The Texas
Strategic Bitcoin Reserve is a special fund in the state treasury
outside the general revenue fund in the custody of the comptroller
for the purpose of holding Bitcoin as a financial asset.
(b) The comptroller shall maintain custody of all Bitcoin
held in the Reserve and is responsible for implementing secure
storage, management, and reporting systems for these assets.
(c) The Reserve is designated as a strategic asset for the
State of Texas and may not be used for purposes other than those
outlined in this subchapter.
(d) The comptroller may accept gifts, grants, and donations
of Bitcoin from certain Texas residents or a governmental entity as
defined by Section 2252.001, Government Code.
(e) The comptroller shall store all Bitcoin for a duration
of at least five years from the date that the Bitcoin enters the
state's custody. After this mandatory period, the Bitcoin may be
transferred, sold, appropriated, or converted to another
cryptocurrency as directed by the comptroller.
Sec. 403.705. MANAGEMENT AND SECURITY. (a) The
comptroller shall develop policies and protocols to ensure the
secure storage and protection of Bitcoin held in the Reserve,
including the use of secure custodial technologies, cold storage,
and best practices in digital asset management.
(b) The comptroller shall prohibit transactions involving
foreign countries, entities or individuals outside of Texas, or
entities or individuals known to engage in illegal activities.
(c) The comptroller may contract with a qualified,
independent, United States-based third-party cryptocurrency entity
to assist in the creation, maintenance, operation, or
administration of the Reserve's security.
(d) The comptroller may conduct regular audits of the
Reserve to ensure transparency and security.
Sec. 403.706. BIENNIAL REPORTS. (a) The comptroller shall
prepare a biennial report including:
(1) the total amount of Bitcoin held in the reserve;
(2) details of the equivalent value of the reserve in
dollars;
(3) the growth of the account since the previous
report;
(4) any transactions or expenditures related to the
Reserve since the previous report;
(6) any security threats experienced since the
previous report; and
(5) the amount of Bitcoin that, after the mandatory
five-year holding period, is eligible to be converted or
transferred.
(b) Not later than December 31 of each even-numbered year,
the comptroller shall electronically publish the report on the
comptroller's Internet website and notify each member of the
legislature that the report is available on the website.
Sec. 403.707. VOLUNTARY DONATIONS OF BITCOIN BY TEXAS
RESIDENTS.
(a) The Texas Strategic Bitcoin Reserve may accept a gift,
grant, donation, bequest, or devise of Bitcoin from Texas
residents.
(b) The comptroller shall develop a straightforward
donation process to facilitate Bitcoin contributions from Texans.
(c) All Bitcoin donations shall be held in the Texas
Strategic Bitcoin Reserve and managed under the same protocols as
other assets in the treasury.
(d) Upon request, the comptroller may issue a certificate of
acknowledgment to individuals or organizations donating Bitcoin to
the Reserve.
(e) The treasury may also establish a recognition program to
publicly honor significant contributions made by Texans.
(f) The comptroller shall have the discretion to determine
the eligibility of donors. If the comptroller determines that a
donor is ineligible, the comptroller may establish a process to
return any Bitcoin transferred to the reserve to the ineligible
donor.
Sec. 403.708. RULEMAKING. The comptroller may adopt rules
as necessary to administer this subchapter, including but not
limited to security protocols, reporting standards, and donation
procedures.
Sec. 403.709. EXPIRATION. This subchapter expires
September 1, 2035.
SECTION 3. The heading to Section 403.023, Government Code,
is amended to read as follows:
Sec. 403.023. CREDIT, CHARGE, CRYPTOCURRENCY, AND DEBIT
CARDS.
SECTION 4. Section 403.023, Government Code, is amended to
read as follows:
(a) The comptroller may adopt rules relating to the
acceptance of credit, charge, certain cryptocurrencies, and debit
cards for the payment of fees, taxes, and other charges assessed by
state agencies. The rules may:
(1) authorize a state agency to accept credit, charge,
certain cryptocurrencies, or debit cards for a payment if the
comptroller determines the best interests of the state would be
promoted;
(2) authorize or require a person that uses a credit,
charge, or debit card to pay a processing fee to the state agency
that accepts the card for a payment; and
(3) authorize a particular state agency to accept
credit, charge, certain cryptocurrencies, or debit cards for a
payment without providing the same authorization to other state
agencies.
(b) The comptroller may adopt rules relating to the use of
credit or charge cards by state agencies to pay for purchases. The
rules may:
(1) authorize a state agency to use credit or charge
cards if the comptroller determines the best interests of the state
would be promoted;
(2) authorize a state agency to use credit or charge
cards to pay for purchases without providing the same authorization
to other state agencies; and
(3) authorize a state agency to use credit or charge
cards to pay for purchases that otherwise may be paid out of the
agency's petty cash accounts under Subchapter K.
(c) The comptroller may not adopt rules about a particular
state agency's acceptance of credit or charge cards for a payment if
the rules would affect a contract that the agency has entered into
that is in effect on September 1, 1993. The comptroller may not
adopt rules about a particular state agency's acceptance of charge
or debit cards for a payment if the rules would affect a contract
that the agency has entered into that is in effect on September 1,
1999.
(d) The comptroller may not adopt rules about a particular
state agency's acceptance or use of credit, charge, cryptocurrency,
or debit cards if another law specifically authorizes, requires,
prohibits, or otherwise regulates the acceptance or use.
(e) State agencies that accept cryptocurrencies shall first
convert the accepted cryptocurrencies to an equivalent value of
Bitcoin, if necessary, before depositing the Bitcoin to the credit
of the Texas Strategic Bitcoin Reserve.
(f) The comptroller shall establish rules to compensate
departments or agencies for the equivalent value of United States
dollars of the Bitcoin received.
SECTION 5. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2025.