On April 30, 2025, the North Carolina House of Representatives passed House Bill 92 (HB 92), known as the Strategic Bitcoin Reserve bill, with a 71-44 vote, marking a historic move toward integrating Bitcoin into the state’s financial strategy. This legislation positions North Carolina as a potential leader among U.S. states in adopting cryptocurrency as a public investment asset, reflecting a growing trend of digital asset acceptance in government portfolios.

The Details of House Bill 92

HB 92, introduced by Republican House Speaker Destin Hall, allows the state treasurer to allocate up to 5% of public funds into Bitcoin-related exchange-traded products (ETPs), such as ETFs traded on regulated U.S. exchanges like NASDAQ and the NYSE. The bill does not permit direct Bitcoin purchases, instead focusing on professionally managed investment vehicles to mitigate risk. To qualify, digital assets must have a market capitalization of at least $750 billion—a threshold currently met only by Bitcoin—ensuring a focus on established cryptocurrencies.

The legislation applies to various public funds, including the state’s General Fund, Highway Fund, and pension systems for teachers, state employees, and other public servants. With North Carolina managing $194 billion in total assets, including a $129 billion state pension plan, this move could potentially channel billions into Bitcoin ETPs, offering a hedge against inflation and a chance for long-term returns.

A companion bill, the State Investment Modernization Act (HB 506), was also passed, establishing the North Carolina Investment Authority to oversee the state’s investment portfolio, including these new digital asset allocations. Additionally, a related Senate bill, SB 327, proposes direct Bitcoin investments up to 10% of public funds, including strategies like staking and lending, though it remains under Senate consideration.

A Divided Reception

The passage of HB 92 has sparked both enthusiasm and concern. Proponents, including Representative Keith Kidwell, argue that it’s a prudent diversification strategy, akin to investing in emerging markets or tech stocks. They see Bitcoin as a hedge against inflation and a way to modernize the state’s financial strategy, especially given its $16 billion pension shortfall. Governor Josh Stein has signaled support, emphasizing the potential for innovation and expanded authority for the state treasurer, Brad Briner, who also backs the bill.

However, critics like Representative Maria Cervania express caution, citing Bitcoin’s volatility and the risks it poses to public funds, particularly for retirees. The State Employees Association of North Carolina has voiced similar concerns, warning that a market downturn could jeopardize pension benefits. To address these risks, the bill mandates secure custody solutions, independent third-party assessments, and regulatory compliance for any digital asset investments.

North Carolina in the National Context

North Carolina’s move comes amid a wave of state-level crypto initiatives. Arizona has already passed similar legislation through both chambers, awaiting the governor’s approval, while states like New Hampshire, Texas, and Kentucky are exploring Bitcoin reserve laws. The city of Roswell, New Mexico, recently became the first U.S. city to make Bitcoin an official reserve currency, highlighting the growing acceptance of digital assets in public finance.

Nationally, the Trump administration’s pro-crypto stance, including calls for a federal Bitcoin reserve, has emboldened states to act. However, federal progress remains slow, with platforms like Polymarket showing little confidence in a national Bitcoin reserve within Trump’s first 100 days. This gap between state and federal action underscores North Carolina’s proactive approach.

What’s Next?

The bill now heads to the North Carolina Senate, where its fate remains uncertain. If passed, North Carolina could become the first U.S. state to gain Bitcoin exposure through regulated investment products, setting a precedent for others. The legislation also mandates studies to explore allowing state employees to invest retirement funds in digital asset ETPs, potentially broadening crypto adoption further.

A Step Toward Financial Innovation?

North Carolina’s HB 92 reflects a broader shift toward embracing digital assets in public finance, driven by the promise of innovation and economic growth. Yet, the debate over Bitcoin’s volatility and regulatory challenges remains unresolved. As the Senate deliberates, the state stands at a crossroads—potentially leading the charge in a new era of financial strategy or facing the risks of early adoption in an untested market.