State of Arizona Enacts Bitcoin Reserve Law Following Crypto Legislation Veto

Key Takeaways:

• Arizona’s Bitcoin Reserve uses unclaimed assets, mirroring the U.S. national model.
• The state goal is to protect taxpayers' funds, but its Budget Stabilization Fund may be the next BTC funding source.
• Arizona and New Hampshire could spark a Bitcoin reserve trend among states.

On May 7, Arizona Governor Katie Hobbs signed House Bill 2749 into law. The approved law allows the state to take control of unclaimed cryptocurrency and create a “Bitcoin Reserve Fund.” By approving this bill, Arizona becomes the second U.S. state to establish a government-backed Bitcoin reserve fund. 

Taxpayer Protection Tipped the Scale in Bill’s Approval

According to an official notice, the signed House Bill 2749 is designed to operate without using taxpayer dollars or state revenue. 

ARIZONA MAKES HISTORY WITH FIRST-EVER STATE CRYPTO RESERVE

– Arizona officially became the second U.S. state to create a state-backed cryptocurrency reserve.

– Governor Katie Hobbs signed House Bill 2749 into law, paving the way for Arizona to secure a reserve fund for digital… pic.twitter.com/WQyQhdK2QA

— BSCN (@BSCNews) May 8, 2025

Instead, Arizona’s Bitcoin Reserve will be built entirely from unclaimed crypto assets, including digital assets that have been forgotten or left untouched for years.

The state can legally claim those assets if someone owns crypto but has not responded to official notices for three years. 

Once that happens, the owner must turn the crypto over to the Arizona Department of Revenue. Arizona will not sell the digital assets for cash; instead, it will keep them in their original form.

What makes this plan different is what the state can do with the crypto. Arizona can use the assets to earn more. 

The state can receive rewards through staking, and it may gain extra digital tokens through airdrops. 

All these new earnings will go into the Bitcoin and Digital Asset Reserve Fund.

Upon approval, Jeff Weninger, a member of Arizona’s House of Representatives and sponsor of the House Bill 2749, said Arizona should not let valuable digital assets go to waste.

He believes the Bitcoin Reserve Fund is a smart way to turn abandoned crypto into something useful for the state without risking taxpayers' money.

✅Arizona Enacts New Law to Secure Unclaimed Digital Assets and Establish Bitcoin Reserve Fund

“Digital assets aren’t the future—they’re the present. This law ensures Arizona doesn’t leave value sitting on the table and puts us in a position to lead the country in how we secure,… pic.twitter.com/HU9pdS8enu

— Arizona House Republicans (@AZHouseGOP) May 7, 2025

Governor Katie Hobbs agreed with that view, hence why she signed House Bill 2749 into law. 

But just before that, she had vetoed another bill, Senate Bill 1025, which also aimed to create a Bitcoin Reserve.

The difference between the two bills was huge. SB 1025 would have allowed Arizona to invest up to 10% of public funds from the treasury and pension system into digital assets like Bitcoin. 

But Hobbs said that was too risky. In her view, Arizona’s retirement system is strong because it relies on safe, proven investments, not untested ones like crypto.

That’s why she turned down SB 1025 but supported House Bill 2749. 

This new law doesn’t ask for public money, it doesn’t touch pensions, and it only uses unclaimed digital assets that would otherwise go unused.

This approach is similar to how the U.S. federal government handles its crypto reserve. At the national level, the Bitcoin reserve is built through asset seizures, not public purchases. 

Is Another Budget Stabilization Bill on Governor Hobbs’ Radar?

Arizona’s move closely follows that of New Hampshire, the first state in the U.S. to approve a Bitcoin Reserve Fund. 

New Hampshire’s House Bill 302 allows the state to invest up to 5% of public funds, including its budget stabilization reserves, into Bitcoin and other digital assets. 

Custody rules are strict: the assets must be held securely, either through a multisig wallet managed by the state or a U.S.-regulated custodian.

With Arizona and New Hampshire officially on board, only two states in the country have created government-recognized Bitcoin reserves. 

But the momentum may not stop there. Governor Katie Hobbs may soon face another decision. 

A more aggressive proposal, known as Senate Bill 1373, is now on her desk. 

It would allow Arizona’s treasurer to allocate up to 10% of the state’s Budget Stabilization Fund directly into Bitcoin.

This mirrors New Hampshire’s 5% digital asset allocation but doubles the exposure. 

And unlike HB 2749, which only uses abandoned assets, SB 1373 involves active investment of public funds, raising the same concerns that led to the veto of SB 1025.

Whether Hobbs will approve this new bill remains uncertain. 

Some see it as a chance to modernize state finance and propel similar trends in other States like Ohio. Others warn that it may be too soon to trust public reserves with unpredictable assets.