Arizona Inches Closer to Crypto Reserve Fund Amid Veto Threat

Arizona’s Strategic Digital Assets Reserve Bill (SB 1373) has passed the House Committee of the Whole and now moves to a final reading and vote in the full House. If approved, the bill will go to Governor Katie Hobbs for consideration. It proposes the creation of a reserve fund containing digital assets, including those obtained through criminal cases, with oversight by the state treasurer.

ARIZONA Update:

Bitcoin Reserve Bill SB 1373 has been passed by the House Committee of the Whole (with a minor amendment).

The next step is Third Reading and final floor vote. pic.twitter.com/oOahjbZATR

— Bitcoin Laws (@Bitcoin_Laws) April 17, 2025

The proposal grants the state treasurer permission to allocate up to 10% of the reserve fund annually into digital assets. It also permits lending from the fund, as long as such actions do not raise the financial exposure of the state. The intention behind these measures is to give Arizona a controlled and organized way to handle and potentially grow the value of digital assets collected through legal proceedings.

Governor’s Veto Stance Could Halt Bill

Governor Katie Hobbs has stated she will not sign any bills until lawmakers approve funding for disability services. This position puts SB 1373 at risk despite its legislative progress. In the last week alone, Hobbs has vetoed 15 bills, including measures supported by both parties.

Julian Fahrer, who leads Bitcoin Laws and is CEO of Apollo, addressed the uncertainty around the bill’s future. 

“There’s a real possibility that SB 1373 could stall, not because of its content, but due to broader political issues,” he said. 

He also mentioned a possible merge with another bill, SB 1062, which would expand Arizona’s definition of legal tender to include crypto assets. 

“Combining the two might be a way to keep the momentum alive,” he added.

Arizona Among Leading States in Digital Asset Legislation

SB 1373 is progressing alongside another proposal, SB 1025, referred to as the Arizona Strategic Bitcoin Reserve Act. This bill seeks to authorize the state’s treasury and public retirement system to allocate as much as 10% of their portfolios to Bitcoin. It has already moved through the House Committee of the Whole and now awaits a full vote on the House floor.

Source: Bitcoin Laws

Other states are also working on crypto reserve bills. Texas and New Hampshire have advanced similar proposals, while Utah approved related legislation last month but later removed key provisions during review. 

According to Fahrer, Arizona’s legislative efforts are “pacing ahead of most states, though Texas might be in a stronger position to finalize its version.”

Lawmakers Weigh Crypto’s Role in State Finance

Arizona’s lawmakers are considering multiple approaches to manage and invest in digital assets at the state level. The state’s proposals include both reserve fund structures and legal recognition of digital currencies. These bills reflect an interest in how crypto could be used in public finance, asset diversification, and long-term planning.

Fahrer emphasized the strategic nature of the effort: “This isn’t about headlines—it’s about giving the state tools to handle a growing part of the economy.” As the final votes approach, all eyes are now on whether Arizona will be the first to formalize a crypto reserve policy at the state level.