More US States are Putting Bitcoin on Public Balance Sheets (cnbc.com) 36
An anonymous reader shared this report from CNBC:
Led by Texas and New Hampshire, U.S. states across the national map, both red and blue in political stripes, are developing bitcoin strategic reserves and bringing cryptocurrencies onto their books through additional state finance and budgeting measures. Texas recently became the first state to purchase bitcoin after a legislative effort that began in 2024, but numerous states have joined the "Reserve Race" to pass legislation that will allow them to ultimately buy cryptocurrencies. New
Hampshire passed its crypto strategic reserve law last May, even before Texas, giving the state treasurer the authority to invest up to 5% of the state funds in crypto ETFs, though precious metals such as gold are also authorized for purchase. Arizona
passed similar legislation, while Massachusetts,
Ohio,
and South
Dakota have legislation at various stages of committee review...
Similarities in the actions taken across states to date include include authorizing the state treasurer or other investment official to allow the investment of a limited amount of public funds in crypto and building out the governance structure needed to invest in crypto... [New Hampshire] became the first state to approve the issuance of a bitcoin-backed municipal bond last November, a $100 million issuance that would mark the first time cryptocurrency is used as collateral in the U.S. municipal bond market. The deal has not taken place yet, though plans are for the issuance to occur this year... "What's different here is it's bitcoin rather than taxpayer dollars as the collateral," [said University of Chicago public policy professor Justin Marlowe]. In numerous states, including, Colorada, Utah, and Louisiana,crypto is now accepted as payment for taxes and other state business...
"For many in the state/local investing industry, crypto-backed assets are still far too speculative and volatile for public money," Marlowe said. "But others, and I think there's a sort of generational shift in the works, see it as a reasonable store of value that is actually stronger on many other public sector values like transparency and asset integrity," he added.
Public policy professor Marlowe "sees the state-level trend as largely one of signaling at present," according to the article. (Marlowe says "If you're a governor and you want to broadcast that you are amenable to innovative business development in the digital economy, these are relatively low-cost, low-risk ways to send that signal.") But the bigger steps may reflect how crypto advocates have increasing political power in the states. The article notes that the cryptocurrency industry was the largest corporate donor in a U.S. election cycle in 2024, "with support given to candidates on both sides."
"It is already amassing a war chest for the 2026 midterms."
Similarities in the actions taken across states to date include include authorizing the state treasurer or other investment official to allow the investment of a limited amount of public funds in crypto and building out the governance structure needed to invest in crypto... [New Hampshire] became the first state to approve the issuance of a bitcoin-backed municipal bond last November, a $100 million issuance that would mark the first time cryptocurrency is used as collateral in the U.S. municipal bond market. The deal has not taken place yet, though plans are for the issuance to occur this year... "What's different here is it's bitcoin rather than taxpayer dollars as the collateral," [said University of Chicago public policy professor Justin Marlowe]. In numerous states, including, Colorada, Utah, and Louisiana,crypto is now accepted as payment for taxes and other state business...
"For many in the state/local investing industry, crypto-backed assets are still far too speculative and volatile for public money," Marlowe said. "But others, and I think there's a sort of generational shift in the works, see it as a reasonable store of value that is actually stronger on many other public sector values like transparency and asset integrity," he added.
Public policy professor Marlowe "sees the state-level trend as largely one of signaling at present," according to the article. (Marlowe says "If you're a governor and you want to broadcast that you are amenable to innovative business development in the digital economy, these are relatively low-cost, low-risk ways to send that signal.") But the bigger steps may reflect how crypto advocates have increasing political power in the states. The article notes that the cryptocurrency industry was the largest corporate donor in a U.S. election cycle in 2024, "with support given to candidates on both sides."
"It is already amassing a war chest for the 2026 midterms."
Why not? (Score:3)
Sure, crypto is funny money now. But that's just ahead of the curve. The US dollar will catch up shortly!
Re: (Score:2)
Hmm, are you implying that crypto is just a finite resource and no more crypto is being produced?
Re: (Score:2)
No, he's implying that Bitcoin is just a finite resource and no more Bitcoin is being produced. Seems clear to me.
Re:Why not? (Score:4, Insightful)
Most crypto is funny money. Tokens printed out of thin air...
ALL currency is funny money. The only thing that gives them value is the general market's willingness to trade goods and services using that currency. There is nothing inherently valuable in any currency. Not gold, Dollars, Bitcoin, teeth, or anything else. All currency is printed out of thin air (yes, gold too). Today's currency is tomorrow's toilet paper.
The only reason Bitcoin is not particularly valuable is that the general market does not generally trade using it. If markets decided today that Bitcoin was a more desirable currency than the Dollar, we would be wiping our asses with the Dollar by mid-day today.
Re:Why not? (Score:4, Interesting)
> If markets decided today that Bitcoin was a more desirable currency than the Dollar, we would be wiping our asses with the Dollar by mid-day today.
That is the bitcoin game-theoretical endgame.
The dollar system has a ton of momentum, so it might not be quite so fast a transition as you think. People dont have a hive mind and dont all decide everything at once.
A ton of economics comes down to peoples memories of the past impacting their present actions. The only reason people accept dollar prices or values of things today is because they remember recent past prices. All prices are "sticky prices", all wages are "sticky wages". So even if some large contingent of people decided they no longer value the dollar network, it would still have value derived from the people who do value it.
If bitcoin continues to survive, and slowly appreciate vs the dollar network, a breaking point may come wherein that effect accelerates. Money systems follow the "network effect", and so long as bitcoin is not fading towards zero value/use, it remains a contender for a network flipover.
> There is nothing inherently valuable in any currency. Not gold, Dollars, Bitcoin, teeth, or anything else. All currency is printed out of thin air (yes, gold too). Today's currency is tomorrow's toilet paper.
Not quite correct; while no system has "inherent money value" which is fully created by human social behaviors, money system do in fact have attributes and qualities which affect how they do function as money networks.
Gold has a more limited supply, but it is slow to validate and extremely slow to transmit.
The dollar system is quicker to validate and transmit, but has a rapidly growing supply which devalues it against itself.
Bitcoin is a historical first: more transmissible and speed greater than the dollar network, combined with an absolute supply cap even more rigid than that of gold.
Those properties are strong enough to keep it in existence despite the network effect of the dollar. Really the only move the dollar system could make to fight back would be an extended period of non-inflation. That would allow the network effect to re-assert itself by removing bitcoins primary advantage.
It is unlikely the dollar system could sustain a large period of non-expansion, but a short burst of extreme deflation might have a similar effect. If neither of those two things happens, bitcoin will continue to slowly appreciate, eventually leading towards some kind of end-game scenario
Re: (Score:2)
It's when they're required to do that, we know they've gone too far.
Unfortunately it will be too late by then.
Re: (Score:3)
But spending 5% on healthcare or something to help people is dumb. I pay taxes. In return I want services.
Re: (Score:2, Funny)
Re: (Score:3)
Well... $100 less network fees... "How much are they?" "We don't know! Depends how busy we are."
Imagine if ATMs worked like that.
Worked out well for Venezuela (Score:5, Interesting)
Fraud, theft, corruption at state level. Oh wait you already have that. In the white house no less. Well done Urmerica.
Fire those officials (Score:3)
Troubles Me (Score:4, Insightful)
This troubles me because I do not accept their stated reason for doing it. And, I do not understand their true reason fro doing it.
I'm left asking myself; why?
Re:Troubles Me (Score:5, Insightful)
Monkey see, monkey do.
Re:Troubles Me (Score:4, Insightful)
You have to understand the current political class. They only care about re-election and keeping their faux jobs and profiting anyway they can from them, not actually doing any real work. In this kind of environment, appearance is everything. The want to appear "in the game", "up on the latest trend", etc. Anything to keep their revenue streams flowing. If that means selling America down the river, they are just fine doing that.
Re: (Score:2, Insightful)
It is a bit of an inflation hedge, and theoretically inversely tied to the stock market. It can help budgets in recession years. Holding ETFs though is more suspicious as they are derivatives and as such have overhead that reduces value over time and likely adds volatility when the broader stock market is down.
I thought there was a legal/constitutional barrier for states to have gold reserves, and maybe the ETFs are a way around that.
Re:Troubles Me (Score:4, Insightful)
Re: (Score:2)
This. I've said it before, "hedging" wih BTC or other cryptocurrency is like installing guardrails made of tannerite.
Re: (Score:2)
That is why I say theoretically on the stock market. Relative to the "real" economy and employment/tax revenue though it is still a bit of a hedge and investment.
Re: (Score:2)
That is why I say theoretically on the stock market. Relative to the "real" economy and employment/tax revenue though it is still a bit of a hedge and investment.
The real economy, employment and tax revenues all also tend to track the stock market, so if it's not a hedge against falling markets, it's also not a hedge against a struggling economy or (what states really care about) falling tax revenues.
Re: (Score:3)
Holding ETFs though is more suspicious as they are derivatives
ETFs are not, in general, derivatives. They're tradeable bundles of securities whose prices track the underlying securities (ETF prices can deviate briefly from the underlying security price, but arbitrageurs quickly bring it back in line[*]). Some ETFs invest in derivatives. Since the topic here is crypto currency crap, you might be talking about the ETFs that invest in crypto currency futures, which are derivatives. There are other ETFs that invest in crypto currency directly, and they are not derivat
NH and TX (Score:3, Interesting)
Idiocracy on the raise (Score:2)
Well, the crash will be all the more spectacular.
Too big to fail! (Score:2)
Just setting themselves up for a massive government bailout, because crypto is "too big to fail". Your tax dollars will bail out the crypto bros!
Re: Current Stage: The Great Grift (Score:1)
Bahahah (Score:4, Insightful)
âoe actually stronger on many other public sector values like transparency and asset integrityâ
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