New Hampshire State Representative Keith Ammon has introduced legislation to create a strategic reserve of digital assets with an average annual market capitalization of more than $500 billion and U.S.-pegged stablecoins to the state treasury, according to a bill passed on January 9 was introduced.
The bill limits investments in these alternative assets to 10% of total public funds, about $360 million, the Treasury Department said. final balance from June 30.
Additionally, the bill emphasizes that these assets must be held through “secure custody solutions,” which guarantee exclusive access to cryptographic private keys, qualified custodians, and registered exchange-traded products (ETP).
ETPs must be approved by regulatory bodies such as the Securities and Exchange Commission (SEC) or the Commodity Futures Trading Commission (CFTC).
Only Bitcoin meets the requirements
According to CryptoSlate data, only Bitcoin (BTC) meets the market capitalization requirement in the proposed cryptocurrency legislation. The treasury can also add stablecoins such as Tether USD (USDT) and USD Coin (USDC).
The bill also allows the state to invest in traditional precious metals such as gold, silver and platinum in addition to crypto.
The proposal also opens the door for New Hampshire to participate in staking, even though Bitcoin is the only cryptocurrency that makes the cut and is not based on a proof-of-stake consensus mechanism.
By integrating staking, New Hampshire would be ready to add crypto like Ethereum (ETH) and Solana (SOL) in a scenario where their market caps meet the criteria and would earn passive income based on their holdings.
Furthermore, the bill proposes the lending of digital assets as another option, provided that the state retains legal ownership and works with third-party providers in both cases.
Not secretly
CEO and co-founder of Satoshi Action Fund, Dennis Porter, was welcomed the bill and declared that it added the high market capitalization requirement to limit state investments in Bitcoin. He explained that in some US states it is impossible to mention the asset by name in the bill.
In response to comments that this was a “stealthy way” to add Bitcoin to the treasury, Porter said explained:
“It’s not a sneaky way. Some states will require us to develop technology-neutral bills, which is very common in policy. It’s a way to reduce political friction. Some accounts will be exclusive to Bitcoin, others will be based on market capitalization. We are working with lawmakers to ensure they have confidence in the bill’s passage.”
New Hampshire is the latest state to initiate legislation to establish a strategic Bitcoin reserve. Porter said that ten more US states are prepared to introduce similar bills in the coming weeks and months, aimed at a strategic Bitcoin reserve.
Representative Mike Cabell introduced similar legislation in Pennsylvania on November 14, 2024, and Representative Giovanni Capriglione followed with similar legislation in Texas less than a month later.
Meanwhile, Alabama State Auditor Andrew Sorrell recently said proposed creation a strategic reserve of BTC, and Jimmy Patronis, Chief Financial Officer of Florida advocated for the same decision.