Everything is bigger in Texas – and now the Lone Star State plans to have the largest strategic bitcoin reserve in the United States.
History was made on Thursday, Dec. 12 when legislation was introduced in the Texas House of Representatives to establish a strategic bitcoin reserve.
Texas House Bill 1598 was filed during an X spaces event hosted by Republican State Representative Giovanni Capriglione and Dennis Porter, Founder of nonprofit advocacy group the Satoshi Action Fund (SAF).
How A Strategic Bitcoin Reserve Will Work in Texas
During the live event, Rep. Capriglione explained that the strategic bitcoin reserve bill will allow the Texas Treasury to accept donations and gifts made in Bitcoin (BTC).
"The Texas State Comptroller will be able to authorize state agencies to accept Bitcoin for state payments," Representative Capriglione said. "Not only will Texans be able to donate Bitcoin to the strategic bitcoin reserve, but we ultimately want individuals in Texas to be able to pay taxes and fees in the form of Bitcoin."
Representative Capriglione added that Texas' strategic bitcoin reserve account will hold Bitcoin for a minimum of five years before funds can be transferred out.
Lee Bratcher, President of the Texas Blockchain Council, further told Cryptonews that all Bitcoin in the strategic bitcoin reserve will be donated by Texans and US companies.
"No taxpayer funds will be spent on buying bitcoin," Bratcher said.
Bratcher – who has also helped draft this piece of legislation – believes this initiative sends a strong message to technology companies and investors.
"Supporting Bitcoin and blockchain initiatives generates employment opportunities in states like Texas within emerging technology sectors," he said.
Importance of a Strategic Bitcoin Reserve in Texas
While other states in the US have been considering implementing a strategic bitcoin reserve, the bill introduced in Texas will likely have a significant impact.
This is because Texas has the eighth largest economy in the world. Texas also ranks as one of the top exporting states globally.
"When you are talking about a strategic bitcoin reserve and how big of a deal this is for a state like Texas, it's huge," Porter said. "Texas has a bigger economy than Russia."
This also means that Texas is ahead of the game when it comes to countries like Russia, which want to eventually implement a strategic bitcoin reserve.
Rep. Capriglione echoed that a strategic bitcoin reserve bill is "huge for Texas," since it will help improve the state's financial position. For instance, he explained that sales tax in Texas can vary, noting that this tax moves around with inflation.
"It's important for us in Texas to have things that work in contrast to these shocks. There is a constant loss happening through inflation. This is just one way that a strategic bitcoin reserve can help. The bill will be structured to counter these negative effects."
Porter added that a strategic bitcoin reserve helps provide financial support for states, emphasizing that this measure is more critical at a state level versus the federal level.
"A strategic bitcoin reserve can protect states against inflation, which is important since many states in the US are struggling," Porter remarked.
Texans May Be Able To Pay Taxes with Crypto
Another interesting aspect of the Texas strategic bitcoin reserve is the possibility for Texans to pay their taxes using cryptocurrency.
Rep. Capriglione believes that many folks in Texas will be interested in paying taxes with Bitcoin.
During the spaces event, he remarked that the strategic bitcoin reserve will allow taxpayers to pay using cryptocurrency, which can then be converted to Bitcoin for the strategic bitcoin reserve.
"I do believe there will be a mad dash for folks to pay their taxes using Bitcoin, especially at the beginning of this," Rep. Capriglione remarked. "Paying a little bit of taxes in Bitcoin will help Texas have BTC in the strategic bitcoin reserve."
Bratcher added that he views this as the first step towards integrating Bitcoin into the Texas economy.
"Eventually, the state will accept taxes in Bitcoin and one day, possibly make it legal tender in conjunction with Federal action," he said.
Strategic Bitcoin Reserve Bill Likely To Pass
While a strategic bitcoin reserve bill in Texas is promising, the legislation must be passed into law before being enacted. Yet policy makers believe that it's likely Texas House Bill 1598 gets passed into law.
"Nothing is certain, but this bill has a high chance of passing given all of the support it has received from Texas elected officials," Bratcher commented.
Indeed, Texas has a number of pro-Bitcoin government officials. For example, Texas Senator Ted Cruz previously told Cryptonews that he owns three Bitcoin mining sites in West Texas and is a huge supporter of cryptocurrency.
"We have talked to Senators who are very excited about this Bill," Rep. Capriglione added. "I expect a Senator to sponsor this soon. I do think this Bill will ultimately be signed by the Texas Governor."
If House Bill 1598 does pass into law, Texas will become the first state to implement a strategic bitcoin reserve. Texas will then serve as an example for other US States to do the same.
"If you live in another State and that State has not yet filled a strategic bitcoin reserve, you can call your State Representative and Senator. You can look at the Bill Texas has filled. We still have a few months to work on this to get it perfect," Rep. Capriglione said.
The post How A Strategic Bitcoin Reserve Will Impact Texas, Its Economy And Taxpayers appeared first on Cryptonews.
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