KeyTakeaways:
North Carolina proposes investing $10B in Bitcoin ETPs from public funds.Several states, including Montana and Maryland, explore public crypto investments.Opposition exists, with previous bills targeting stricter crypto mining regulations.
North Carolina is considering a new legislative measure that could allow the state to invest public funds in Bitcoin exchange-traded products (ETPs). Filed Monday by Representative Deborah Ross (D-NC), the bill seeks to allocate up to 10% of North Carolina’s public funds and retirement system assets into Bitcoin ETPs.
If the bill passes, the state could direct more than $10 billion toward Bitcoin-focused investment products. This move aligns North Carolina with a growing trend across the United States, where various states are exploring ways to integrate digital assets into their public investment strategies.
Bitcoin ETPs as a Target for State Funds
The bill targets Bitcoin ETPs, investment vehicles built around the world’s first and most well-known cryptocurrency. Currently, Bitcoin is the only digital asset eligible for inclusion under the bill, reflecting the broader legislative interest in cryptocurrency-backed financial products.
If enacted, the proposal would allow the North Carolina State Treasurer to manage investments in these Bitcoin-based products, marking a step toward mainstream institutional adoption of digital currencies.
North Carolina is not the only state exploring public investments in cryptocurrencies. Several other states have introduced similar bills, with Montana, Maryland, and Kentucky among the latest to file legislation aiming to channel public funds into digital assets, including Bitcoin and stablecoins.
The specifics of each proposal vary, with some allowing direct investments in cryptocurrencies themselves, while others focus on related financial products like Bitcoin ETPs. These developments indicate a growing recognition of digital assets as a potential avenue for diversifying state investments.
Skepticism and Opposition to Cryptocurrency Investments
While the bill has garnered attention for its bold approach to digital asset investment, not all North Carolina lawmakers support the idea. Last year, a separate proposal was introduced to impose stricter regulations on cryptocurrency mining in specific counties, namely Henderson, Polk, and Rutherford.
The bill also outlines provisions for managing these investments. The state would be permitted to enter into third-party investment management agreements with entities both inside and outside the U.S. Furthermore, the investment companies involved would be required to provide the state treasurer with annual audited financial statements, although the Treasurer could waive this requirement following a cost-benefit analysis.
