Bitcoin is sagging against the backdrop of President Trump’s tariff gambit. But HODLers might find solace in the possibility of improving long-term adoption.
Those include a rising number of states that are considering establishing bitcoin reserves or investing directly in the digital currency. Should some of those bills eventually become law, that could bode well for spot bitcoin exchange traded funds, including the CoinShares Valkyrie Bitcoin Fund (BRRR ).
In recent months, politicians in more than half of U.S. states – 26 to be precise – have introduced bills calling for the establishment of bitcoin reserves. They are taking a page from the White House’s playbook. In what could be a positive sign for funds like BRRR, the group of states considering these bills isn’t confined to “red” or “blue” status. For example, Alabama and Minnesota are two of the latest to see such bills introduced.
Earlier this week in Alabama, Republican state Senator Will Barfoot introduced companion legislation to House Bill 482, which would allow the state to invest in cryptocurrency. But this bill confines those investments to the digital currency.
It’s Not Easy Passing Bitcoin Bills
For owners of ETFs like BRRR, it’s becoming evident that while the headlines pertaining introduction of states’ adoption of bitcoin are nice, the real catalyst is getting the legislation signed into law, which is easier said than done.
Last November, a bitcoin reserve bill was introduced in Pennsylvania, arguably a purple state, but it failed. That was followed by rejection of similar legislation in Montana, North Dakota, South Dakota, and even in crypto-enthusiastic Wyoming. Partisan squabbling in those states is largely viewed as the reason why bitcoin legislation failed.
Conversely, the optimistic side of the coin indicates that state-level adoption of bitcoin isn’t necessarily dead. After all, it’s a newfangled concept. Despite the aforementioned legislative failures, it’s now on states’ radars. That means the issue is likely to be brought up again, with potentially stronger pushes for success.
It might take just one state to get the other dominos to fall. Obviously, it’d help if it was a large state such as Texas.
Last month, two Democratic representatives in Texas introduced a bill that would allow the state’s Economic Stabilization Fund to invest as much as $250 million in bitcoin. It would also allow cities and towns to invest up to $10 million in crypto. Republicans may get on board with the bill and push it to Gov. Greg Abbott’s® desk. Should this happen, it could be the state-level catalyst bitcoin investors have been waiting for.
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