North Carolina heads into the world of cryptocurrencies: new law on Bitcoin ETP investments

North Carolina heads into the world of cryptocurrencies: new law on Bitcoin ETP investments

North Carolina has become the latest US state to explore the world of digital assets. The southern state's House of Representatives has filed a bill that would allow the state treasurer to invest public funds in "qualified" digital assets, specifically Bitcoin exchange-traded products (ETPs).

The bill, called the "NC Digital Assets Investments Act" (HB 92), was introduced on February 10 by Speaker of the House of Representatives Destin Hall. This legislation is intended to diversify the state's investments and allow the Treasurer to include digital assets in his or her portfolio. A key requirement, however, is that investments must be directed only to products that are traded on an exchange.

The conditions for inclusion of digital assets are strict. In addition to the fact that they must have an average market capitalisation of at least $750 billion over the past 12 months, which currently means that only Bitcoin meets this condition, there is also a limit on the level of investment - a maximum of 10% of the balance of any sovereign wealth fund at the time of investment.

"Investing in digital assets like Bitcoin has the potential to generate positive returns for our state's investment fund while strengthening North Carolina's position as a leader in technology and innovation," Hall said. In a social media post, he added that the move is in line with President Trump's "vision for a national bitcoin stockpile" to ensure North Carolina's leadership role.

Lawmakers and the bill's sponsors stressed that investing in cryptocurrencies could be the answer to rising inflation and the devaluation of the U.S. dollar. Among the state funds that could benefit from these investments are teachers' pension funds, state employee pension funds, insurance funds and veterans' funds.

"Blockchain technology, decentralized finance and other innovations in cryptoassets will shape our future in many new ways. North Carolina is poised to seize these new opportunities," said bill co-sponsor Mike Schietzelt.

North Carolina is not alone; the number of U.S. states proposing crypto-investment legislation is growing almost daily. Currently, 19 states are considering similar proposals. For example, Arizona and Utah have already advanced their bills to higher stages of the legislative process, while North Dakota has rejected such proposals.

HB 92 is therefore another step in a trend that shows the growing acceptance of and interest in cryptocurrencies in the US. North Carolina can become one of the pioneers in investing in digital assets and show how modern technology can shape the future of public finance.

*This is not an investment recommendation.

Coingarage Team