Texas Senate Passes Bitcoin Reserve Bill SB21, Pioneering State-Level Crypto Adoption

In a landmark decision, the Texas Senate voted 25-5 today to pass Senate Bill 21 (SB21), officially titled the Texas Strategic Bitcoin Reserve and Investment Act.

The legislation, championed by Senator Charles Schwertner (R-Georgetown), establishes a state-managed Bitcoin reserve, positioning Texas as the first U.S. state to formally adopt cryptocurrency as a strategic financial asset.

The bill now heads to the Texas House of Representatives, where its passage could cement the Lone Star State’s role as a trailblazer in the evolving digital economy.

Announced via a press release from Schwertner’s office at 7:45 PM WAT and amplified by posts trending on X, the vote marks a significant victory for crypto advocates following weeks of debate.

SB21 authorizes the Texas Comptroller to create a special fund outside the state treasury, granting broad discretion to acquire, manage, and sell Bitcoin and other cryptocurrencies with an average market cap exceeding $500 billion over 12 months—a threshold currently met only by Bitcoin. The reserve aims to diversify Texas’ financial portfolio, hedge against inflation, and bolster economic resilience.

“Texas is leading the charge in the digital economy,” Schwertner said in a statement following the vote.

“Bitcoin is a scarce, valuable asset that can strengthen our balance sheet and protect against fiscal uncertainty. This is about securing our state’s future.”

The senator’s remarks echo his floor speech earlier today, where he likened Bitcoin to gold, arguing it’s not a rival to the dollar but a complementary store of value.

A Breakthrough After Setbacks

The passage of SB21 comes after a rocky road for state-level Bitcoin reserve proposals nationwide. Earlier this year, similar bills faltered in states like Montana and Wyoming, dampening crypto enthusiasts’ hopes.

Texas’ success, however, has reignited optimism. The bill’s journey began in January 2025, with Schwertner introducing a Bitcoin-only version. Following a February refiling to include other digital assets—prompted by President Donald Trump’s January 23 executive order on a federal “digital asset stockpile”—SB21 gained momentum.

On February 27, it cleared the Senate Business and Commerce Committee with a unanimous 9-0 vote, setting the stage for today’s decisive floor approval.

Support wasn’t unanimous, though. Five senators, primarily Democrats, voted against the measure, citing Bitcoin’s volatility—evidenced by a recent 20% drop from its January peak of $109,350 to $85,821—and the risks of tying state funds to a speculative asset.

“We’re gambling with taxpayers’ money,” warned Senator Judith Zaffirini (D-Laredo) during the debate. Yet, the bill’s bipartisan backing, including from three GOP co-sponsors, underscored a growing acceptance of crypto’s potential.

Crypto Community Cheers, Eyes Implications

The crypto and DeFi communities erupted in celebration on X, with posts hailing Texas as a “crypto leader” and speculating on market impacts. “Texas just passed SB21! Huge step for crypto adoption,” one user wrote, attaching a rocket emoji.

Another predicted, “Institutional legitimacy could boost BTC demand—watch the prices.” Analysts suggest that if Texas actively acquires Bitcoin, it could join a wave of state-level purchases projected by VanEck to total $23 billion across 20 states—equivalent to roughly 247,000 BTC at current prices.

The bill’s passage also dovetails with a parallel effort by Representative Giovanni Capriglione (R-Southlake), whose House bill proposes holding Bitcoin from taxes and fees for at least five years.

Together, these initiatives signal Texas’ ambition to integrate crypto into its fiscal strategy, potentially inspiring other states—or even the federal government, where President Trump has floated a national Bitcoin stockpile.

What’s in SB21?

SB21 outlines a robust framework for the Texas Strategic Bitcoin Reserve:

Funding: The reserve will draw from legislative appropriations, dedicated revenues, purchased cryptocurrencies, investment earnings, and private donations (though a donation provision was streamlined out by the Senate committee).

Management: The Texas Comptroller, advised by a five-person expert committee, will oversee investments, with authority to contract third-party administrators and mandate independent audits.

Scope: Investments are limited to cryptocurrencies with a $500 billion-plus market cap, ensuring focus on established assets like Bitcoin (currently valued at $1.9 trillion).

Proponents argue this structure balances innovation with prudence, while critics question the lack of a specific investment cap or exit strategy. “If Bitcoin tanks, what’s the contingency?” asked Senator Zaffirini. Supporters counter that its capped supply—21 million coins—makes it a long-term inflation hedge, unlike fiat currencies.

Next Steps and Broader Impact

SB21 now faces the Texas House, where GOP dominance suggests a favorable outlook, though debate could intensify over fiscal risks.

If passed, it awaits Governor Greg Abbott’s signature—a near-certainty given his vocal crypto support, symbolized by an “eyes-open” emoji posted in February. Passage would make Texas a pioneer, potentially pressuring other states and the Biden administration to reconsider their stances on digital assets.

For blockchain advocates, this is more than a state law—it’s a signal.

“Texas is showing the world that crypto isn’t just a fad; it’s a financial tool,” said Lee Bratcher, president of the Texas Blockchain Council, who testified in favor of SB21. As Bitcoin hovers in a bear market, the reserve could also test crypto’s resilience as a state-held asset, with ripple effects for DeFi and beyond.

On-Chain Media will track SB21’s progress through the House and its implications for crypto adoption, monetary policy, and decentralized finance. Stay tuned for updates.