On November 20, Texas became the first U.S. state to purchase Bitcoin as a strategic reserve, acquiring $5 million at approximately $87,000 per Bitcoin, according to Lee Bratcher, president of the Texas Blockchain Council.
The purchase was made through BlackRock’s iShares Bitcoin Trust (IBIT) while the state finalized its self-custody plan.
The move signals growing state-level interest in Bitcoin as a reserve asset. Texas was considering a strategic Bitcoin bill last year, hoping to create a Bitcoin reserve without using taxpayer funds.
In June of this year, the governor of Texas signed a bill creating the state’s Strategic Bitcoin Reserve.
Institutional investors are also increasingly following suit. Harvard University’s endowment recently tripled its holdings in IBIT to $442.8 million, making it the university’s largest public investment.
Emory University and Abu Dhabi’s Al Warda Investments also significantly increased their Bitcoin ETF exposure.
Bitcoin’s price is currently trading around $87,500, about 30% below its all-time high. Lee Bratcher was the first to reveal the news.
“Eventually the state of Texas will self-custody Bitcoin,” Bratcher said.
Mr. Bratcher is the Chairman and Founder of the Texas Blockchain Council, an industry association of more than 100 member companies and hundreds of individuals promoting Texas as a center for Bitcoin and blockchain innovation.
He actively defended the state’s Bitcoin reserve bill and worked on the ground to get it passed in the state Senate.
Texas isn’t the only state interested in buying Bitcoin
Among the bills considered last year, Texas Representative Giovanni Capriglione introduced a bill to create a strategic Bitcoin reserve for the state.
The bill proposes that the state buy and hold Bitcoin as a strategic asset, keep it in cold storage for at least five years, allow citizen donations, and allow state agencies to accept and exchange the virtual currency for Bitcoin.
It also mandated transparency through annual audits and reports. The bill, modeled after a federal proposal by President Donald Trump and Senator Lummis, reflects growing global interest in Bitcoin.
Earlier this month, New Hampshire became the first government in the world to approve $100 million in Bitcoin-backed municipal bonds. The state’s Bureau of Corporate Finance (BFA) approved conduit bonds, allowing private companies to borrow over-collateralized Bitcoin and bear the risk of repayment solely on the collateral.
Borrowers must account for approximately 160% of the bond’s value in Bitcoin, and automatic liquidation protects bondholders in the event of a decline in value. The fees and BTC appreciation will fund the state’s Bitcoin Economic Development Fund.
The move follows New Hampshire and Arizona’s previous creation of strategic Bitcoin reserves.
Discover more from Earlybirds Invest
Subscribe to get the latest posts sent to your email.
