This year, the Texas Legislature passed legislation establishing a strategic Bitcoin reserve in the state, opening the door to other cryptocurrencies in the future. Ether could become the next reserve asset, according to the bill’s original sponsor.
On Thursday, Texas State Senator Charles Schwertner spoke to Cointelegraph to discuss the implementation of the Bitcoin (BTC) Preparation Act that Governor Greg Abbott signed into law in June. Although the bill’s language allows Texas to hold other cryptocurrencies in “special funds outside the Treasury,” only Bitcoin met the requirements at the time of passage.
“I’m very interested in seeing how quickly they establish reserves and how it performs from a revenue standpoint,” Schwertner said. “If Ethereum maintains its market capitalization over the next 24 months, I think it would be reasonable and prudent to give Ethereum some direction to add to its cryptocurrencies (reserves).”
sauce: Charles Schwertner
Under the law establishing and governing the Texas Strategic Bitcoin Reserve, a virtual currency must have an “average market capitalization of at least $500 billion over the most recent 24 months” to qualify as a reserve asset. Bitcoin, with a market capitalization of over $2 trillion, meets this criteria.
Related: Massachusetts Bitcoin reserve bill receives lukewarm response at public hearing
By comparison, Ether (ETH) has only maintained a market capitalization above $500 billion twice: for about a month in 2021 and intermittently from August to October of this year. On Friday, the price of ETH and its market capitalization plummeted, with the latter reaching around $494 billion at the time of the announcement.
How does Texas law differ from laws passed in other states?
While many U.S. states have rejected or failed to advance similar bills to create virtual currency reserves, Arizona and New Hampshire signed legislation into law in 2025. Arizona’s fund includes cryptocurrencies seized through criminal forfeiture, while New Hampshire law allows the state treasury to use the funds to invest in cryptocurrencies with a market capitalization of more than $500 billion.
“We’re the only state that actually put sovereign money, taxpayer money, into the reserve fund,” Schwertner said, adding, “We took the reserve fund and the money behind it to the fullest (establishing) it.”
The state auditor said the state comptroller is considering implementing the law, including for managers of sanctuary properties. Under the terms of the law, the custodian must be a “state or federally chartered financial institution” or other entity regulated by Texas.
The Texas law and others being considered come after the federal government under President Donald Trump established both the Strategic Bitcoin Reserve and the Digital Asset Reserve in March. The executive order stated that the confiscated cryptocurrencies would be used to fund reserves, but officials later added that there is a “budget-neutral way” to buy BTC.
magazine: ‘Help! My robot vacuum is stealing my Bitcoin: when a smart device attacks
Discover more from Earlybirds Invest
Subscribe to get the latest posts sent to your email.
