At the intersection of the worlds of cryptocurrency and traditional finance, a new legislative proposal is sparking widespread discussion. The draft, titled "Bitcoin Strategic Reserve Act of 2025," was drafted by the Bitcoin advocacy organization Satoshi Action Fund and aims to incorporate Bitcoin into the fiscal systems of U.S. states as a strategic reserve tool. This is not only an unprecedented attempt, but also a bold step to combat inflation and enhance financial resilience amid growing global economic uncertainty.
1. Bitcoin: The New "Gold" of State Governments?
With Trump's coming to power, Aiying's previous article introduced a detailed explanation of the "U.S. Bitcoin Strategic Reserve Act": purchasing 200,000 bitcoins each year and reaching 1 million within five years, which is one step closer to reality. Even the "Bitcoin Strategic Reserve Act of 2025" has been proposed, with the goal of authorizing state finance officials to include Bitcoin in fiscal reserves to resist asset depreciation caused by inflation.
In the first part of the draft, legislators clearly pointed out that inflation has seriously eroded the purchasing power of state finances and retirement funds, affecting the economic well-being of residents. Although state governments cannot control the federal money supply and macroeconomic policies, they have the responsibility to protect the financial health of the state. Therefore, Bitcoin, as an anti-inflation asset, has been put on the agenda. Data shows that Bitcoin's market value has soared rapidly in the past 16 years and now exceeds 1 trillion US dollars, which undoubtedly proves its potential in anti-inflation.
Second, resilience and innovation: What is the intention of the new legislation?
In the draft, the state government plans to pass legislation to allow Bitcoin and other digital assets to be included in the state's financial investment portfolio as a means of dealing with inflation and economic uncertainty. The core goal of the legislation is to:
Protect the purchasing power of state finances and prevent assets from depreciating due to inflation.
Through flexible investment policies, quickly respond to market changes and increase returns.
Ensure that investment strategies are consistent with the goal of enhancing state economic security and financial resilience.
The bill places special emphasis on flexibility. In the context of an increasingly complex and rapidly changing global economy, traditional investment models often appear too rigid, and the introduction of digital assets such as Bitcoin provides more diverse options for investment portfolios, enabling state governments to better respond to market risks.
Third, safe custody: safeguards for digital assets
In the holding and management of digital assets, the draft bill imposes strict requirements on security. Specifically, there are three ways to custody Bitcoin: direct holding by the state treasury, holding on behalf of a qualified custodian, or holding through a registered exchange-traded product (ETP). At the same time, in order to ensure the security of digital assets, the draft proposes a "secure custody solution" - requiring private keys to be controlled only by the government and stored in an encrypted environment, and ensuring the security of assets through measures such as geographically dispersed data centers and multi-party governance structures. This move is intended to eliminate public concerns about the security of digital assets and ensure the security and stability of digital assets in custody and management.
Specifically, the "secure custody solution" includes the following measures:
Private key exclusive control: Encrypted private keys must be controlled by government entities and can only be accessed in an end-to-end encrypted environment.
Geographically dispersed data centers: The hardware devices of private keys must be stored in at least two geographically dispersed secure data centers to prevent the risks of failure in a single location.
Multi-party governance structure: The authorization of each transaction must go through a multi-party governance structure to ensure that all transactions are strictly approved and recorded.
Disaster recovery mechanism: The hosting service provider must have a comprehensive disaster recovery mechanism to ensure that the state government can still access and manage assets when the provider is unable to perform its duties.
Regular code audits: The hosting solution must undergo regular code audits and penetration tests by the auditing company, and any discovered vulnerabilities must be fixed in a timely manner.
Fourth, Bitcoin taxation: A new source of funding for public services?
Part V of the bill deals with the payment method of taxes and fees. According to the draft, taxes paid with Bitcoin will be transferred to the state's general fund, and the state fund will compensate the corresponding digital asset account with US dollars. This arrangement not only ensures the flexible use of funds, but also means that the acceptance of Bitcoin at the state level has been significantly improved.
Specifically, the process of paying taxes with Bitcoin is as follows:
Tax payment: Taxpayers can use Bitcoin to pay taxes, and these Bitcoins will first enter the state's general fund account.
Fund conversion: The state general fund will compensate the designated digital asset account with an equivalent amount of US dollars to ensure financial balance.
Transparent management: Through blockchain technology, the Bitcoin income and expenditure process is open and transparent, reducing the risk of corruption and abuse of funds.
In addition, the draft also allows state retirement funds to invest in registered digital asset exchange products, further enriching investment channels. These measures show that Bitcoin is not only a tool to fight inflation, but it may also become part of the funding source for public services and gradually integrate into people's daily lives.
V. Behind the legislation: an experiment in financial innovation
The Bitcoin Strategic Reserve Act of 2025 is undoubtedly an unprecedented attempt and a microcosm of the modernization of the financial system. With the passage of the "Bitcoin Rights" Act in Pennsylvania, the introduction of this strategic reserve bill seems logical and far-reaching. As an advocate of Bitcoin, Satoshi Action Fund attempts to promote the application of Bitcoin in a wider range of fields through such legislation, provide legislators with a perspective to understand blockchain technology, and help them seize the opportunities of the digital age in the process of policy making.
Aiying FundInsight is also paying close attention to such legislative trends and is committed to helping Web3 and traditional financial institutions find the best path for compliance management under such a policy background. We believe that although the high volatility and risk characteristics of Bitcoin are challenges that legislators must face, this risk can be minimized through a reasonable compliance framework and effective management tools. We assist various financial entities in building a reasonable fund structure and support their fund-raising activities from the perspective of compliance and operational convenience to ensure steady development in a changing market environment.
In order to meet these challenges, the draft proposes some risk control measures:
Investment cap: The proportion of state fiscal investment in Bitcoin shall not exceed 10% of the total amount of the relevant fund to prevent over-reliance on a single asset.
Asset lending: Without increasing financial risks, state finances can obtain additional income by lending Bitcoin, but they must follow the rules set by state finance officials.
Diversified investment strategy: State governments are encouraged to continue to invest in other traditional financial assets while introducing Bitcoin to ensure the stability of the overall investment portfolio.
Whether this proposal can be widely accepted and implemented in the end remains to be discussed and evaluated by state governments and the public. But it is undeniable that the idea is still worth learning from.
In short, the "Bitcoin Strategic Reserve Act of 2025" is ambitious and attempts to enhance the resilience and flexibility of public funds by incorporating Bitcoin, an emerging digital asset, into the state fiscal system. Behind the legislation, there is both an urgent need to promote financial modernization and a cautious prevention of emerging risks. Whether this experiment can succeed and provide a new paradigm for future government investment and financial innovation, let us wait and see. Aiying FundInsight will continue to provide support to Web3 and traditional financial institutions to help them move forward steadily in this unprecedented transformation and innovation.
Draft link: https://www.satoshiaction.io/sbr
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