The Texas Senate on Thursday passed a measure that would establish a state-controlled cryptocurrency reserve. The move comes just days after President Donald Trump announced plans to create a U.S. crypto strategic reserve.
Senate Bill 21, authored by Republican Sen. Charles Schwertner of Georgetown, would allow the state comptroller to buy, hold and manage Bitcoin and other digital assets as “a hedge against inflation and economic volatility.” The reserve would be funded through legislative appropriations and donations from private citizens and corporations.
The bill would also create a committee to provide investment recommendations for which cryptocurrency to buy to the comptroller. If signed into law, Texas would become the first U.S. state to create its own cryptocurrency reserve.
“This bill will allow Texas to diversify our investment approach, participate competitively in the evolving digital, financial economy and leverage the benefits of Bitcoin and other cryptocurrencies,” Schwertner said.
Schwertner says his proposed crypto reserve would be subject to regular third-party audits, the findings of which would be released in a report to the state legislature every other year.
The bill passed out of the Senate with 25 legislators in favor and five against. It now heads to the Texas House for consideration.
Before passing, the proposed bill led to a heated debate between Schwertner and Democratic Sen. Roland Gutierrez of San Antonio, who raised concerns about Bitcoin’s volatility and the potential risks associated with allocating state funds to cryptocurrency.
“When the economy is down, Bitcoin is down, and the fluctuations on this stuff is insanity,” Gutierrez said. “We have so many real concerns in this state, and so many of our citizens that’re asking for real help, and the last thing that we need to do is go benefit some techno bro.”
Gutierrez argued that the use of crypto was “completely unregulated” — a claim that Schwertner pushed back on, saying cryptocurrency was regulated by blockchain technology, which is essentially a digital ledger that records transactions. Schwertner added that a blockchain is decentralized, meaning the data it’s not owned or operated by one single entity.
“In some ways, it is more accountable because it has that decentralized nature,” Schwertner said. However, Gutierrez was not convinced.
“All I’ve heard is it’s a blockchain and it’s a computer, it’s an algorithm,” Gutierrez asked. “We’re supposed to allow that algorithm, that computer and … some crypto bros to regulate themselves?”
Despite Gutierrez’s continued pushback, the bill was fast-tracked out of the Senate by a majority of lawmakers who moved to skip a third reading of the bill, which is the last step before a proposed law can move onto the next chamber for discussion.
Gov. Greg Abbott has previously expressed interest in making Texas a hub for the use of crypto. On Sunday. Trump announced a proposed national crypto reserve, signaling a significant federal endorsement of digital assets like Bitcoin, Ethereum, XRP, Solana and Cardano.