Florida Republican Senator Joe Gruters has introduced a bill proposing the investment of part of the state’s funds in Bitcoin and other digital assets to counter rising inflation. It follows a string of other US states recently moving toward the same goal.
“The state should have access to tools such as Bitcoin to protect against inflation,” Gruters said in a Feb. 7 bill introduced to the Florida Senate.
“Inflation has eroded the purchasing power of assets held in state funds managed by the chief financial officer,” he said.
Bitcoin institutional adoption cannot be ignored
Gruters highlighted major asset management firms such as BlackRock, Fidelity, and Franklin Templeton already adopting Bitcoin and viewing it as a “hedge against inflation,” along with Bitcoin having “greatly risen in value” and becoming more widely accepted as an international medium of exchange as reasons Florida should consider investing state funds in the asset class.
Gruters proposed allowing Florida’s chief financial officer Jimmy Patronis to invest Bitcoin in the state’s general reserve fund, the budget stabilization fund, and various other agency trust funds.
However, he said Bitcoin holdings in any account should be capped at 10%. Meanwhile, Wyoming’s comparable recent proposed bill limits allocations to no more than 3%.
It comes only months after Patronis wrote a letter urging the Florida State Board of Administration to consider adding Bitcoin to the state’s retirement funds investments.
Growing list of US states proposing legislation aimed at Bitcoin Reserve
“Bitcoin is often called ‘digital gold,’ and it could help diversify the state’s portfolio and provide a secure hedge against the volatility of other major asset classes,” wrote Patronis in an Oct. 29 letter.
Just a day before Gruter’s filing, Kentucky became the 16th US state to introduce legislation aimed at establishing a Bitcoin reserve.
The bill, KY HB376, was introduced by Kentucky State Representative Theodore Joseph Roberts on Feb. 6. If passed, it would authorize the State Investment Commission to allocate up to 10% of excess state reserves into digital assets, including Bitcoin.
