Arizona Senate Advances Bill to Create Digital Assets Reserve Fund
Decrypt
by Vismaya VFebruary 24, 2026
AI-Generated Deep Dive Summary
The Arizona Senate has advanced a bill aimed at creating a state-managed Digital Assets Reserve Fund. The legislation, SB 1649, allows the state treasurer to hold, invest, and loan seized digital assets such as Bitcoin, XRP, Digibyte, stablecoins, and NFTs through qualified custodians or approved exchange-traded products. This bill represents Arizona's latest effort to establish a crypto reserve, despite Governor Katie Hobbs' prior opposition to similar proposals.
The measure was approved by the Senate Finance Committee in a 4–2–1 vote on February 16 and later cleared by the Senate Rules Committee on February 23. It now moves to the full Senate floor for further consideration. SB 1649 defines "digital assets" as those meeting a "cryptocurrency fair value score" of at least 1% of a benchmark tied to Bitcoin's market price when it reached $100,000 per coin. The fund would be administered by the state treasurer, who has authority to invest and loan assets to generate returns, provided there is no increased financial risk to the state.
Arizona lawmakers are pushing forward with this initiative despite Governor Hobbs' history of rejecting crypto-related bills. In 2025, she vetoed a nearly identical proposal, citing market volatility and risks. The current bill reflects ongoing efforts by Arizona to adopt crypto policies, though its ultimate success depends on whether it survives potential executive scrutiny.
The broader crypto market has been struggling, with Bitcoin down nearly 28% over the past month and the sector overall down 3.8%. This weakening market adds another layer of uncertainty for the bill's prospects. If passed, SB 1649 would represent a significant step toward institutional adoption of digital assets, offering a framework for managing and profiting from seized crypto.
For readers interested in crypto, this development highlights Arizona's leadership in exploring innovative uses for blockchain technology. The bill underscores growing interest in integrating crypto into state finance while addressing
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Originally published on Decrypt on 2/24/2026