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Texas is moving forward with plans to implement a strategic Bitcoin reserve. State Representative Giovanni Capriglione announced yesterday that he has introduced a bill that would allow states to accept donations, fees, and taxes in the form of Bitcoin, provided they are held for a minimum of five years.
“Probably our biggest investment enemy is inflation,” Capriglione said. “Investing strategic Bitcoin reserves in Bitcoin would be a win-win for the state.”
Texas is the second state in the US to consider incorporating Bitcoin into its financial strategy. In November of this year, legislation was introduced to form the Pennsylvania Bitcoin Strategic Reserve, which includes plans to allocate up to 10% of the state's state reserves to Bitcoin.
This comes after the Pennsylvania House of Representatives passed what is informally known as the Bitcoin Bill of Rights in October, giving Pennsylvania residents the potential to We have given you the option of Bitcoin as a payment method.
“By enacting this legislation, we will make the commonwealth a friendlier place for blockchain innovation and provide our citizens with the tools to safely participate in the digital economy,” said House Bill 2481, the Digital Assets Act. Sponsored Congressman Mike Cabell said. Licensing Act – as it is formally known.
What does this mean for the crypto economy?
The moves by both Texas and Pennsylvania to establish strategic Bitcoin reserves are good news for the crypto economy, although they are still at the state rather than federal level. But Dennis Porter, CEO of the nonprofit Satoshi Action Fund, which worked with Capriglione on the draft bill, is optimistic.
“In our opinion, the state level is the best place to generate political momentum for Bitcoin,” he said in an interview with CNBC New York. “The best thing we can do is pass this bill at the state level and provide political impetus for federal legislation.”
Bitcoin, which boomed after the US election and reached the $100,000 milestone, continued to rise following yesterday's announcement of the Texas Strategic Bitcoin Reserve, but was slightly down at the time of writing.
Bitcoin rose following the announcement of the Texas Strategic Bitcoin Preparation Act. Source: CoinMarketCap
“During its short history, Bitcoin has experienced both significant rises and falls,” asset management firm BlackRock noted in a report released earlier this week. BlackRock's iShares Bitcoin Trust ETF currently has approximately $53.8 billion in assets under management.
In addition to this volatility, BlackRock's report adds, “Bitcoin's unique characteristics raise questions about what role it should play in a portfolio.” The financial giant advises investors to include up to 2% Bitcoin in their portfolios.
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