Texas is the first US state to set up a legally protected strategic bitcoin reserve. The fund must offer protection against inflation and economic shocks. This makes Texas legally ahead of other states that also experiment with public bitcoin investments.
Bitcoin as a weapon against inflation
The law signed by Governor Greg Abbott gives Texas the opportunity to buy Bitcoin directly. The state can also receive Bitcoin via a fork, airdrop or donation. According to the law, the fund must serve as “protection against inflation and economic volatility”.
What is special is that the reserve may only contain Bitcoin or other cryptocurrencies with an average market value of at least $ 500 billion over a 24 -month period. At the moment, only Bitcoin meets that criterion.
The law imposes strict rules for security. The manager of the fund must conclude contracts with a recognized Custodian for the storage of the purchased Bitcoin. This is to ensure that safety is arranged at an institutional level.
The management of the reserve lies with the Texas officer. There will be an advisory committee that supervises, but the final decisions remain with the officer. A public report must appear twice a year on the performance and status of the fund.
Texas sets a legal example for other states
New Hampshire preceded Texas with legislation on public investments in Bitcoin. New Hampshire uses a strategy in which up to 5 percent of state capacity can be actively invested in Bitcoin. Work is being done in Arizona on the further elaboration of the Bitcoin reserve fund. The Senate has since agreed to the HB2324 bill. After an earlier rejection, the proposal has been submitted again and is now at the House of Representatives.
Nevertheless, Texas is the first state to ensure that the fund cannot simply be canceled by the next government. Moreover, the income and interest from the fund may not be transferred to other goals.
Source: https://newsbit.nl/texas-richt-strategische-bitcoin-reserve-op-ter-bescherming-tegen-inflatie/
