Texas is on the verge of becoming the first U.S. state to establish a state-managed Bitcoin reserve. Senate Bill 21 (SB21), introduced by Senator Charles Schwertner, has passed the Senate and a House committee, and is now scheduled for a full House vote on Tuesday, May 20, 2025.
What Is SB21?
SB21 proposes the creation of the Texas Strategic Bitcoin Reserve, a special fund managed by the state comptroller. The reserve would invest in cryptocurrencies, initially focusing on Bitcoin, provided the asset has a market capitalization of at least $500 billion over the past 12 months . The fund would be established outside the state treasury, granting it greater autonomy in investment decisions.
Legislative Progress
The Texas Senate approved SB21 with a 25-5 vote on March 6, 2025. On May 7, a House committee passed the bill with a 9-4 vote along party lines . If the full House approves the bill on May 20, it will proceed to Governor Greg Abbott’s desk for final approval.
🇺🇸 State Reserve Race Update:
Texas Bitcoin Reserve Bill SB 21 is scheduled for Second Reading in the House on Tuesday May 20.
If it passes, then a Third Reading and final vote is likely to occur next week. pic.twitter.com/NNnDAGvzmL
— Bitcoin Laws (@Bitcoin_Laws) May 16, 2025
Support and Criticism
Supporters argue that Bitcoin can serve as a hedge against inflation and economic volatility, enhancing the state’s financial resilience. Lieutenant Governor Dan Patrick has expressed strong support, viewing the reserve as a step toward securing Texas‘ financial future.
Critics, however, caution against the volatility and risks associated with cryptocurrencies. Concerns have been raised about the lack of detailed safeguards and the potential for market manipulation, especially with donations from external sources.
Looking Ahead
The outcome of the May 20 House vote will determine whether Texas becomes a pioneer in state-managed cryptocurrency reserves. If enacted, SB21 could set a precedent for other states considering similar initiatives.
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