Lawmakers introduce bitcoin reserve bills in Maryland, Iowa, and Kentucky
Legislators in Maryland, Iowa, and Kentucky have introduced bills to establish Bitcoin (BTC) strategic reserves in their states. These latest proposals bring the total number of US states considering Bitcoin reserves to 17, signaling a growing interest in integrating cryptocurrency into state financial strategies.
Kentucky’s house bill 376 expands investment options
Representative TJ Roberts introduced Kentucky House Bill 376 to revise the state’s financial practices by expanding investment options for excess state funds. The bill amends regulations governing the State Investment Commission, authorizing investments in diverse asset classes, including digital assets, US government-backed obligations, and collateralized certificates of deposit.
Under the bill, digital assets eligible for investment must have an average market capitalization of at least $750 billion over the previous calendar year. As of February 2025, only Bitcoin meets this criterion, with Ethereum (ETH) falling short at a $320.6 billion market cap.
Additionally, the legislation limits Bitcoin investments to 10% of the state fund’s total excess cash and allows state agencies to accept payments in digital assets and bullion while prohibiting the use of central bank digital currencies (CBDCs). The bill also enables state retirement funds and deferred compensation plans to invest in exchange-traded digital asset products. It establishes a framework for handling digital asset receipts, ensuring conversion to US currency when necessary, and authorizes state agencies to regulate these investments.
Maryland and Iowa join the bitcoin movement
Maryland’s House Bill 1389, introduced by Representative Caylin Young, seeks to establish the Maryland Bitcoin Reserve Fund. This initiative would position Bitcoin as a reserve asset, with the State Treasurer authorized to invest funds obtained from certain gambling violations into Bitcoin—a unique approach to digital asset accumulation.
Meanwhile, Iowa’s House File 246, introduced by Representative Taylor Collins, outlines investment allowances for the State Treasurer. The bill permits investments in precious metals and digital assets with a market capitalization exceeding $750 billion, averaged over the previous calendar year. Additionally, it allows investments in stablecoins. Eligible investment funds include the state’s general fund, cash reserve fund, and Iowa economic emergency fund. The bill caps digital asset investments at 5% of the available public funds at the time of investment.
A new avenue for public funds
These legislative proposals aim to channel unspent, unencumbered public funds into Bitcoin, positioning it as a potential store of value within state reserve portfolios. States such as Texas and Pennsylvania are also exploring similar initiatives, while New Mexico recently introduced Senate Bill 57 to allocate 5% of public funds toward Bitcoin.
Proponents argue that diversifying state reserves with digital assets could hedge against inflation and economic instability. However, critics remain cautious about the risks associated with volatility and regulatory uncertainty.
State-level crypto initiatives gain traction
Maryland’s initiative highlights the expanding national interest in integrating digital assets into government financial planning. The bill would allow the state treasurer to invest revenue from gambling violations—potentially amounting to billions—into Bitcoin, converting punitive fines into economic growth opportunities.
Supporters believe this move will diversify the state’s asset base and signal Maryland’s commitment to modernizing fiscal strategies. With regulatory discussions evolving at the federal level, such measures are seen as crucial for keeping pace with global financial innovation.
As Maryland’s legislature deliberates on the proposal, market observers will closely watch how state-level adoption of digital assets impacts fiscal stability and broader cryptocurrency adoption. If successful, these initiatives could encourage additional states to incorporate Bitcoin into their public investment portfolios, further solidifying its role in government financial planning.
