Michigan's legislature will consider a bill to create a cryptocurrency reserve.
A bill to create a Michigan Strategic Cryptocurrency Reserve has been sent back to the House Government Operations Committee for reconsideration.
The bill was introduced by two Republican legislators, Bryan Posthumus and Ron Robinson. They proposed amending state budget management laws. According to the Republicans' proposal, the state Treasury would be able to invest up to 10% of local budget funds or the special economic stabilization fund in cryptocurrency.
The document states that state authorities will be able to choose one of three methods for storing crypto assets: through a custodial service; a qualified bank, trust company, or any regulated entity; or through exchange-traded products of registered investment companies. The initiative's authors proposed granting state authorities the right to issue cryptocurrency loans to generate additional profits, provided that the loans do not expose the state reserve to financial risks.
The bill outlines technical security requirements for custodial solutions. These include exclusive state control over private keys, end-to-end encryption, prohibition of smartphone access, the creation of geographically dispersed secure data centers, multi-party transaction confirmation, and regular security audits.
The document does not specify which digital assets should be included in the strategic reserve, but it does indicate that these could be digital assets that are generated using code and that operate independently of the central bank.
The Michigan Bitcoin Trade Council criticized the draft law because it fails to specify the market capitalization required for cryptoassets eligible for inclusion in the state reserve. The organization fears that including cryptocurrencies other than Bitcoin would create unnecessary risks.
Montana, North and South Dakota, Wyoming, and Pennsylvania have rejected bills for a strategic bitcoin reserve, and 17 states are still considering similar bills.
A few months ago, the governor of Texas signed a law creating a crypto reserve, and the governor of Arizona signed a law establishing an unclaimed digital asset fund.
Source: cryptonews.net
