Texas introduces third Bitcoin reserve bill, expanding crypto investment for state and local governments

A third Bitcoin reserve bill has been introduced in Texas, giving the state’s comptroller direct authority to invest in cryptocurrencies and allowing local governments to hold Bitcoin.

Introduced by Texas State Representative Ron Reynolds on March 11, House Bill 4258 expands on previous proposals by setting clear investment limits.

What is HB 4258?

The bill proposes allowing the Texas comptroller, Texas’ chief accountant and financial watchdog, to invest up to $250 million from the state’s economic stabilisation fund into “Bitcoin or other cryptocurrencies.”

It also extends this to municipalities and counties, though they would only be allowed to hold up to $10 million in crypto.

If passed, the law would take effect on September 1, 2025.

Other Bitcoin bills under consideration

Texas lawmakers are currently reviewing two other Bitcoin-related bills: Senate Bill 778 (SB 778), introduced by Senator Charles Schwertner on January 14, 2025, and Senate Bill 21 (SB 21), also introduced by Schwertner on February 12.

Unlike HB 4258, SB 21, which passed the Texas Senate on March 6 and is now under review by the state House, was originally introduced as a Bitcoin-only bill.

However, lawmakers later revised the language to include other digital assets, expanding its scope.

It hopes to create a Texas Strategic Bitcoin Reserve, a separate fund from the state treasury, which the comptroller will manage.

The reserve would be used to acquire, hold, and manage Bitcoin, with provisions allowing the state also to accept private donations in BTC.

A key requirement in SB 21 states that any digital asset held must have a market capitalisation of at least $500 billion over the past 12 months, effectively limiting investments to Bitcoin.

It also gives the comptroller discretionary authority to invest, sell, or manage the state’s Bitcoin holdings, following the “prudent investor” standard used in traditional finance.

Meanwhile, SB 778 takes a different approach by focusing on long-term Bitcoin custody rather than active management. 

Under SB 778, Texas would acquire and hold Bitcoin as a strategic asset, with a five-year minimum embargo on selling any of its holdings.

The bill also allows the state to accept Bitcoin donations.

Texas is currently one of the frontrunners, alongside Arizona, in the race to become the first state to establish a Bitcoin reserve, following Utah’s decision to drop the Bitcoin reserve clause from its related bill.

As previously reported by Invezz, the Texas State House is expected to act on SB 21 by May 24.

However, Satoshi Act Fund founder Dennis Porter, citing a source familiar with the matter, suggested that lawmakers may expedite the process, potentially bringing the bill to the governor’s desk sooner than expected.

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