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Arizona, one of the first states to establish Bitcoin (BTC) reserves, restored a failed crypto legislation in an attempt to update the state’s forfeiture laws to include digital assets.
Arizona lawmakers reconsider Bitcoin reserve bill fails
The Arizona Senate voted to revive a Bitcoin reserve bill that failed to pass the third reading of the House last month. On Thursday, the Senate voted 16-14 for a motion to reconsider the legislation, which has now returned to the House.
The measure was brought by Republican Senator Janae Shamp, one of the Senate members who voted against the bill last month because only lawmakers who oppose the legislation can make the motion.
The House of Representatives Act of 2324 (HB 2324) proposed by Republican Representative Jeff Weninger is intended to update Arizona’s forfeiture laws to include digital assets and to establish new regulations for seizure, storage and distribution of cryptocurrencies and other digital assets.
The bill will create new procedures for law enforcement to seize digital assets including bitcoin, access to digital wallets and private keys. Additionally, it will create a “Bitcoin and Digital Asset Reserve Fund” to manage the seized assets.
The allocation of funds will allow the Attorney General’s Office to acquire $300,000 worth of seizure assets. Meanwhile, 50% is divided into the Attorney General’s Office, 25% of the State General Fund and 25% of the New Digital Asset Reserve Fund.
HB 2324 also articulates the limitations of property confiscation, including protection of innocent owners and when property can be seized, aiming to modernize the law of forfeiture to address the complexity of cryptocurrencies in criminal investigations.
Arizona’s crypto legislation
The revival was created under a bill that updated Arizona’s unclaimed property laws that include Bitcoin and other cryptocurrencies, and technically, the state created the state’s first crypto reserve.
House Bill 2749 (HB 2749), also sponsored by Representative Weninger, was signed into law on May 7 by Arizona Gov. Katie Hobbs, allowing authorities to retain unclaimed cryptocurrencies and other assets and establish a “bitcoin reserve” without the use of state funds or taxpayer money.
The legislation does not allow investment, but allows the state to transfer unclaimed assets, airdrops and deposit rewards to the reserves.
HB 2749 updated Arizona’s unclaimed property laws to illustrate the growing growth of digital assets, including cryptocurrencies. The law establishes a clear process for identifying and handling unclaimed virtual property, protecting the value of digital assets held by the state, and creating a reserve that can be used for future grants if legislatively approved.
Bitcoin Law, the policy tracking platform, pointed out that this is a major move because it shows that Gov. Hobbs vetoed two cryptocurrency bills last month, despite Governor Hobbs’ willingness to enact pro-Claterto legislation.
As Bitcoiners reported, the governor of Arizona rejected Senate Bill 1025 (SB 1025) and Senate Bill 1373 (SB 1373), believing that cryptocurrency assets were too “untested” and evaporated state funds.
SB 1025, also known as the “Arizona Strategic Bitcoin Reserve Act,” will allow public funds in Arizona, such as the National Treasury Department or retirement system, to invest in 10% of assets (AUM) in cryptocurrency management.
Meanwhile, SB 1373 will establish a “digital asset strategic reserve fund” that does not include pension fund investment. But Hobbs argued that she “has signed the legislation of this session that allows the state to use cryptocurrencies without putting general funds at risk.”
To promote the revived HB 2324 to Governor Hobbes’ table for approval, the bill requires a majority vote from 60 Arizona House members.
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