Arizona Governor Katie Hobbs Vetoed Senate Bill 1025

Arizona Governor Katie Hobbs vetoed Senate Bill 1025 on Friday, ending the state's bid to become the first in the U.S. to establish a Strategic Bitcoin Reserve.

Arizona Governor Katie Hobbs has vetoed Senate Bill 1025, effectively shutting down the state’s attempt to become the first in the U.S. to establish a Strategic Bitcoin Reserve.

The bill, which was passed by the Arizona House on Friday with a 31-25 vote, would have allowed the state to invest seized funds in Bitcoin at a rate of $96,314 per BTC and create a Digital Assets Strategic Reserve Fund managed by state officials. A companion bill, SB 1373, which proposes allocating up to 10% of Arizona’s rainy-day fund to digital assets, now awaits a final vote.

According to a statement from Governor Hobbs, her decision to veto the bill was based on her belief that Bitcoin is an "untested investment" that would be unsuitable for Arizona's robust State Retirement System.

"Arizonans' retirement funds are not the place for virtual currency," said Governor Hobbs in a letter to Senate President Warren Petersen. "This administration will continue to stand for sound economic policies that benefit all Arizonans."

The move comes as no surprise, given that Governor Hobbs had previously announced her intention to block any bills not related to a bipartisan disability funding agreement, which was finally reached on Monday.

The initiative also failed to garner enough votes for an override, which would have led to legislation to overturn her decision.

The news will likely upset crypto supporters, who saw the bill as a crucial step towards holding Bitcoin in state treasuries to hedge against inflation and make Arizona a leader in new financial thinking.

While Arizona's attempt to create a Bitcoin reserve has ultimately failed, it's worth noting that other states like Oklahoma, Montana, South Dakota, and Wyoming also failed to pass similar Bitcoin investment plans.

However, North Carolina is now set to become the first state to hold a portion of its treasury in cryptocurrencies following the passage of a law on April 30, 2025, that allows the state to invest up to 5% of some funds in cryptocurrencies. The bill is currently being reviewed by the Senate of North Carolina.

Earlier this year, in March 2025, President Donald Trump signed an order to create a national Strategic Bitcoin Reserve and a Digital Asset Stockpile, signaling support for holding Bitcoin and other digital currencies at the federal level. On 29th April, the US lawmakers had passed the legislation, and the bill was adopted by the Arizona House of Representatives.