While more and more American states are investigating whether Bitcoin can play a role as a state reserve, Montana has closed that door for the time being. A bill that would give the state the option of using gold, stablecoins and Bitcoin as a reserve, among other things, was rejected by 41 votes to 59.
Bitcoin as a state reserve: progressive or too risky?
The bill, House Bill No. 429, could have given Montana the option of parking part of its reserves in cryptocurrencies that had a market value of more than 750 billion dollars over the past year. At the moment, only Bitcoin meets that condition.
Supporters of the bill, such as Representative Lee Demming, argued that the state should get the most out of its tax dollars. “If we are going to hold on to tax dollars, we should either be getting the highest return possible or simply returning the money to the taxpayers,” he argued.
Curtis Schomer, the initiator of the bill, went a step further. According to him, not investing in Bitcoin would be the bigger mistake. “The only real risk investment is not to pass this bill,” he said. He pointed out that Montana’s investment council is losing purchasing power by holding onto bonds.
Skepticism and fear of speculation
Opponents of the bill, especially within the Republican Party, felt the move was too bold. Steven Kelly emphasized that tax dollars should be managed carefully and that the risks of Bitcoin are too great. “We are here to protect tax dollars, not gamble with them.”
Bill Mercer found it particularly problematic that the investment council would be given complete freedom to determine which cryptocurrencies or NFTs could be purchased. “I didn’t come here to do that,” he said. Another legislator summed it up succinctly: “This feels like pure speculation.”
Bitcoin as a state reserve? Other states are already further along
Although Montana is ignoring Bitcoin for the time being, there are other states that are taking serious steps. A total of 24 American states have submitted a bill to recognize Bitcoin as a state reserve. Utah is leading the way: there, the bill HB230 has already been approved by the Senate Committee on Taxation and Revenue. Now all that remains is the second and third vote in the Senate.
Texas, Arizona and South Dakota are also among the states considering Bitcoin as a state reserve. In 20 of the 24 states, the bill is still pending.
