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Arizona has become the second state in the United States to establish a cryptocurrency reserve fund. Governor Katie Hobbs signed House Bill 2749 into law on Wednesday, May 7, 2025. This legislation allows the state to claim ownership of digital assets, including cryptocurrencies, that have been unclaimed for at least three years.
Here’s a breakdown of the key aspects of this new law:
* Unclaimed Digital Assets: Digital assets are considered abandoned if the rightful owner fails to respond to communication attempts over a three-year period.
* Seizure and Staking: Once deemed abandoned, these digital assets must be delivered to the Arizona Department of Revenue in their native form. The state’s qualified custodians are authorized to stake these assets to earn rewards or receive airdrops.
* Bitcoin and Digital Asset Reserve Fund: Any staking rewards or airdropped assets will be deposited into a newly created Bitcoin and Digital Assets Reserve Fund. This fund will be administered by the State Treasurer and is subject to legislative appropriation.
* No Taxpayer Money: It’s important to note that this reserve fund will not utilize taxpayer money or state funds. It will be solely funded by the proceeds generated from the unclaimed digital assets.
* Diversification: The law includes strong diversification rules, ensuring that Bitcoin supplements but doesn’t dominate Arizona’s investment portfolio within this reserve.
* U.S.-Regulated Custody: The digital assets held in the reserve fund must be kept with U.S.-regulated custodians.
This move by Arizona follows a similar step taken by New Hampshire, which recently passed legislation allowing the state treasury to invest in cryptocurrencies with a market capitalization exceeding $500 billion (currently only Bitcoin meets this criterion).
Context and Related Legislation:
It’s worth noting that this development comes shortly after Governor Hobbs vetoed a separate bill, Senate Bill 1025, which would have allowed the state to invest up to 10% of its treasury and pension assets directly into digital assets like Bitcoin. Her reasoning for the veto cited concerns about using public funds for “untested investments.”
However, the signing of HB 2749 suggests a more cautious but still forward-thinking approach to digital assets by the state, focusing on leveraging unclaimed property rather than direct investment of taxpayer funds.
There is also another bill, Senate Bill 1373, awaiting the Governor’s approval. This bill proposes establishing a “Digital Assets Strategic Reserve Fund” that could hold state-appropriated funds and digital assets seized by law enforcement, with the State Treasurer having the authority to loan these assets to generate returns.
The establishment of this cryptocurrency reserve fund in Arizona signifies a growing recognition of digital assets by state governments and a move towards incorporating them into state financial management in innovative ways.

Video courtesy of KDPW

Video courtesy of KDPW