Arizona Governor Katie Hobbs Vetoes Bitcoin Investment Bill

Arizona will not be adding Bitcoin to its list of official state investments — at least not under Democratic Governor Katie Hobbs.

Democratic Governor Katie Hobbs has vetoed a bill that would have allowed Arizona to invest in Bitcoin and other digital assets, rejecting a measure that crypto advocates had hoped would usher in a new era of decentralized finance in the state.

The move, which comes as no surprise given the governor’s earlier threat to block all legislation over unresolved disability funding, is a setback for those who had hoped to see the bill become law.

In her veto message, first reported by The Block, Hobbs said that Arizonans’ retirement system is strong because it sticks to proven investment strategies. She added that she believes it’s inappropriate to expose the state’s retirement funds to untested investments like digital assets.

“I am returning this bill without my signature,” the governor wrote.

The bill, also known as SB1025 or “Arizona Strategic Bitcoin Reserve Act,” was co-sponsored by Senators Wendy Rogers and Jeff Weninger. It would have permitted state officials to invest up to 10% of the state treasury and pension assets in digital assets like Bitcoin.

If enacted, the measure would have made Arizona the first state in the U.S. to adopt such a policy.

Lawmakers in several other states, including Oklahoma, Montana, South Dakota, and Wyoming, have proposed similar legislation, but none of the measures have advanced.

Earlier this year, Hobbs’ predecessor, Republican Governor Doug Ducey, signed legislation that created a legal framework for crypto activities in Arizona. The law defined relevant terms, established use cases, and set forth reporting requirements for crypto companies operating in the state.

The governor also rejected a bill that would have created a Digital Assets Strategic Reserve Fund. The measure, SB1373, is now awaiting the governor’s decision.

Hobbs has now vetoed 75 bills in 2025, surpassing the 73 vetoes she issued during all of 2024. Her record remains the 143 bills she blocked in 2023, the most by any governor in Arizona history.

Earlier this month, the governor vetoed a bill that would have banned the use of so-called critical race theory in public schools. The move came after the Republican-led state legislature passed the measure in an effort to restrict diversity, equity and inclusion initiatives in education.

The bill, which was viewed as a response to a national movement on critical race theory, aimed to prevent teachers from being able to discuss topics such as racism and sexism in a broad sense. Instead, it focused on the technical definition of critical race theory as a theory of law that examines how legal doctrines and legal institutions, such as segregation, slavery, and property, created racial hierarchy and inequality.

In her veto message, Hobbs said that she is committed to ensuring that all students in Arizona have access to a high-quality education. She added that she believes it’s important to leave educators free to teach the curriculum in the best way possible, and to respond to the needs of their students.

“I am returning this bill without my signature,” the governor wrote.

Lawmakers on Monday approved two bills, SB1025 and SB1373, the latter proposing the creation of a Digital Assets Strategic Reserve Fund, which is now awaiting the Governor’s decision. However, Hobbs’s track record suggests the bill may be headed for the same fate as previous measures.

According to reports by The Block, in her veto message, Hobbs stated that Arizonans’ retirement system is strong because it sticks to proven investment strategies. She added that she believes it’s inappropriate to expose the state’s retirement funds to untested investments like digital assets.

“This bill would permit the state to invest up to ten percent of its treasury and pension assets in digital assets, becoming the first state in the U.S. to do so,” Hobbs wrote in her veto message.

The bill, which was co-sponsored by Senators Wendy Rogers and Jeff Weninger, passed the state legislature earlier this month and was sent to the governor’s desk for her approval.

The measure, which is also known as SB1025 or the “Arizona Strategic Bitcoin Reserve Act,” would have allowed the state to invest in a variety of digital assets, including Bitcoin, Ethereum, and other cryptocurrencies.

The bill would have also created a new task force to study the potential for investing in digital assets and to make recommendations to the governor and state legislature.

Proponents of the bill argued that it would help to diversify the state’s investment portfolio and provide new opportunities for economic growth. They also noted that several other states are considering similar legislation.

However, opponents of the bill raised concerns about the volatility of digital assets and the potential for fraud. They also argued that the bill would have exposed the state’s retirement funds to undue risk.

Earlier this year, the governor threatened to block all legislation in protest at the state legislature’s failure to allocate any funds for disability