Arizona Governor Vetoes Bitcoin Reserve Bill, Citing Concerns Over “Untested” Crypto Investments
In a decisive move that underscores the ongoing debate over cryptocurrency in government finance, Arizona Governor Katie Hobbs has vetoed a bill that would have permitted the state to invest a portion of its public funds in virtual assets such as bitcoin. The proposal, passed by the Republican-led legislature, would have authorized up to 10% of state treasurer and retirement system funds to be allocated to digital currencies.
Governor Hobbs, a Democrat, defended her decision in a public letter, emphasizing the importance of safeguarding Arizonans’ retirement security. “The Arizona State Retirement System is one of the strongest in the nation because it makes sound and informed investments,” she wrote. “Arizonans' retirement funds are not the place for the state to try untested investments like virtual currency.”
The bill, co-sponsored by Republican lawmakers, had cleared both the Senate and House earlier this month. Supporters saw it as a step toward modernizing state-level finance and embracing digital innovation. However, Hobbs had previously signaled she would not approve new legislative efforts until a bipartisan state budget is passed—particularly one that ensures healthcare protections for residents with disabilities.
Her veto has drawn sharp criticism from members of the crypto community. David Bailey, CEO of Bitcoin Magazine, took to social media platform X (formerly Twitter), calling for her impeachment and accusing her of undermining Arizona’s economic future.
Arizona is not alone in weighing the role of cryptocurrency in public finance. Similar bitcoin reserve bills are currently being considered in several other U.S. states, including Texas, Missouri, and Iowa, although none have advanced to law.
While advocates argue that strategic investment in bitcoin could serve as a hedge against inflation and a bold move toward digital transformation, critics caution against exposing public funds to volatile and still-evolving financial instruments.