A bill permitting public retirement funds to allocate up to 10% in Bitcoin has been vetoed by the Governor of Arizona.
Governor Katie Hobbs vetoed Senate Bill 1025, known as the “Arizona Strategic Bitcoin Reserve Act,” on Friday, halting a legislative initiative that aimed to authorize state treasurers and retirement systems to allocate up to 10% of state funds into Bitcoin and other cryptocurrencies.
In a letter to Senate President Warren Petersen, Governor Hobbs stated that the Arizona State Retirement System ranks among the nation’s strongest because of “sound and informed investments.” She emphasized that the state should not use retirement funds to experiment with unproven assets like cryptocurrencies.
According to a national tracker monitoring legislative activity, Arizona has become the sixth state to reject a Strategic Bitcoin Reserve proposal, while similar legislation remains under consideration in 19 other states.
On Saturday, Anthony Pompliano, head of Professional Capital Management—an investment firm leveraging content channels for deal sourcing and consumer interaction—posted a tweet stating, “Imagine the ignorance of a politician to believe they can make investment decisions.”
The bill, which both legislative chambers approved without any amendments, proposed a framework allowing the state to invest in digital assets and potentially store them in a federally created “Strategic Bitcoin Reserve,” if the federal government establishes one.
The measure formed part of a broader cryptocurrency policy initiative in Arizona, accompanied by companion legislation SB1373, which still awaits action on the governor’s desk.
Companion Legislation and Broader Digital Asset Framework
SB1373, known as the “Digital Assets Strategic Reserve Fund,” would allow the state to manage digital assets obtained through appropriations or confiscations, including those from criminal proceedings.
In contrast to SB1025, SB1373 does not authorize the investment of public funds; instead, it outlines custody procedures and exempts the fund from the state’s typical fiscal year lapse regulations.
Although Governor Hobbs vetoed SB1025, SB1373 remains eligible for approval if she interprets it as an administrative tool rather than support for speculative cryptocurrency exposure.
Governor Hobbs’s decision on that bill may indicate whether Arizona’s broader digital asset framework will continue beyond the current legislative session.
Although the Legislature approved both measures earlier this year, Governor Hobbs had previously indicated her intention to veto Republican-backed proposals not tied to budget discussions.
With her action, Arizona becomes the latest state to halt crypto-related public finance legislation, despite growing interest in such initiatives across the country.
