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Arizona, one of the first states to establish a Bitcoin (BTC) reserve, has revived a failed crypto legislation seeking to update the state’s forfeiture law to include digital assets.
Arizona Lawmakers Reconsider Failed Bitcoin Reserve Bill
The Arizona State Senate voted to revive a Bitcoin reserve bill that failed to pass the House of Representatives’ third reading last month. On Thursday, the Senate voted 16-14 in favor of the motion to reconsider the legislation, which is now headed back to the House.
The measure was filed by Republican Senator Janae Shamp, one of the Senate members who voted against the bill last month, as only a lawmaker who opposed the legislation can file this motion.
House Bill 2324 (HB 2324), introduced by Republican Representative Jeff Weninger, aims to update Arizona’s forfeiture laws to include digital assets and establish new provisions for seizing, storing, and allocating cryptocurrencies and other digital assets.
The bill would establish new procedures for law enforcement to seize digital assets, including Bitcoin, gaining access to digital wallets and private keys. Additionally, it would create a “Bitcoin and Digital Assets Reserve Fund” to manage seized assets.
The funds allocation would see the first $300,000 worth of seized assets go to the Attorney General’s office. Meanwhile, any amount over that would be divided 50% to the Attorney General’s office, 25% to the State General Fund, and 25% to the new Digital Assets Reserve Fund.
HB 2324 also clarifies rules around property forfeiture, including protections for innocent owners and limitations on when properties can be seized, aiming to modernize forfeiture laws to address the complexity of crypto in criminal investigations.
Crypto Legislation In Arizona
The revival follows the enactment of a bill that updated Arizona’s unclaimed property laws to include Bitcoin and other cryptocurrencies, technically creating the state’s first crypto reserve.
House Bill 2749 (HB 2749), also sponsored by Representative Weninger, was signed into law by Arizona Governor Katie Hobbs on May 7, allowing authorities to keep unclaimed cryptocurrencies and other assets and establish a “Bitcoin Reserve Fund” without using state funds or taxpayers’ money.
The legislation doesn’t allow investments, but enables the state to move unclaimed assets, airdrops, and staking rewards into a reserve.
HB 2749 updates Arizona’s unclaimed property laws to account for the growing presence of digital assets, including cryptocurrencies. The law establishes a clear process for identifying and handling unclaimed virtual property, protects the value of digital assets held by the state, and creates a reserve fund that may be used for future appropriations with legislative approval.
Policy tracking platform Bitcoin Laws noted that this was a significant move as it showed Governor Hobbs is “willing to enact pro-crypto legislation,” despite vetoing two crypto bills last Month.
As reported by Bitcoinist, Arizona’s Governor vetoed Senate Bill 1025 (SB 1025) and Senate Bill 1373 (SB 1373), arguing that crypto assets were too “untested” and volatile for state funds.
SB 1025, also known as the “Arizona Strategic Bitcoin Reserve Act,” would have allowed public funds in Arizona, such as the state treasury or retirement system, to invest up to 10% of their assets under management (AuM) in cryptocurrencies.
Meanwhile, SB 1373 would have established a “Digital Assets Strategic Reserve Fund” that didn’t include retirement fund investment. However, Hobbs argued that she “already signed legislation this session which allows the state to utilize cryptocurrency without placing general fund dollars at risk.”
For the revived HB 2324 to advance to Governor Hobbs’ desk for approval, the bill needs a majority vote from the 60 Arizona House members.
Featured Image from Unsplash.com, Chart from TradingView.com
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