Key Points
- Illinois is considering a proposal to hold Bitcoin in its fiscal reserves, a first for any U.S. state.
- The Bitcoin Strategic Bill, if passed, would allow the Illinois State Treasurer to manage a fund accepting Bitcoin gifts, grants, and donations.
Illinois is on the brink of becoming the first state in the United States to include Bitcoin in its fiscal reserves. This development is contingent upon the approval of the Strategic Bitcoin Reserve proposal, which is currently under review by the Rules Committee. The proposal was put forward by John Cabello.
The Bitcoin Strategic Bill
On January 29, the Bitcoin Strategic Bill was presented to the Rules Committee. The aim of this bill, introduced by Illinois State Representative John Cabello, is to lay the groundwork for Bitcoin to become a strategic asset for the state of Illinois.
Details of the Proposed Bitcoin Reserve Bill
The proposed legislation stipulates that the Illinois State Treasurer would oversee a fund that can accept Bitcoin gifts, grants, and donations from Illinois residents and government entities. Once received, the Bitcoin must be held for a minimum of five years.
After this five-year period, the State Treasurer would have the authority to transfer, sell, or convert the Bitcoin into another cryptocurrency. The bill also includes provisions for hiring a cryptocurrency treasurer, managing and securing the fund, reporting on the fund’s status, and allowing Illinois residents to voluntarily contribute Bitcoin to the fund.
The bill would also permit the State Treasurer to develop rules for managing this reserve. If passed, the Strategic Bitcoin Reserve Act would take immediate effect, potentially making Illinois the first U.S. state to introduce a formal Bitcoin reserve strategy.
Increasing Interest in Bitcoin Reserves
Cynthia Lummis, a U.S. Congress member and long-time Bitcoin advocate, has been lobbying for a national Strategic Bitcoin Reserve. She argues that Bitcoin could provide a hedge against inflation and economic volatility. On January 30, she expressed her desire to hold public hearings on the Bitcoin Strategic Reserve, reflecting the growing interest in Bitcoin-based reserves among institutions.
On the same day, Aleš Michl, the Governor of the Czech National Bank, announced that Czechia might become the first Western European country to include Bitcoin in its reserves. He proposed allocating up to 5% of the CNB’s €140 billion ($145.6 billion) reserves in Bitcoin, marking a significant step towards institutional crypto adoption at the national level.
Similarly, Texas Governor Dan Patrick declared his intention to establish a “Texas Bitcoin Reserve,” making it one of his top legislative priorities for the 2025 session. As more large banks and investment firms embrace Bitcoin, U.S. policymakers are exploring ways to align state and federal reserves with this trend.