North Carolina’s new Bitcoin bill could allocate $950M from estimated general fund to BTC

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Key Takeaways

North Carolina’s new bill could invest up to $950 million of public funds in Bitcoin.
The legislation would create a Bitcoin Economic Advisory Board and require multi-signature cold storage for reserves.

North Carolina lawmakers have introduced a new bill that could see the state invest heavily in Bitcoin, potentially allocating up to $950 million from its estimated general fund.

The proposed legislation, also known as the “NC Bitcoin Reserve and Investment Act” or SB327, would authorize the Office of the State Treasurer to allocate up to 10% of the state’s public funds to Bitcoin (BTC) as part of a long-term financial strategy.

While the legislation does not specify the exact size of the public funds pool, data from the Office of the State Controller shows that North Carolina’s general fund stood at $9.5 billion as of March 14.

North Carolina's new Bitcoin bill could allocate $950M from estimated general fund to BTC

Applying the bill’s 10% cap to this figure yields the $950 million that has captured attention as a potential investment sum.

Official budget reports from the Office of State Budget and Management (OSBM) forecast General Fund revenues at $34.7 billion for FY 2024-25, but the $9.5 billion figure likely reflects a discretionary portion available for the proposed investment under the bill’s terms.

Should the applicable funds differ, the 10% allocation would adjust accordingly.

If enacted, the acquired Bitcoin would form a dedicated Bitcoin Reserve, managed by the State Treasurer with an eye toward financial innovation. The bill also permits the Treasurer to engage in regulated, yield-generating activities such as staking and lending.

Under the proposed legislation, Bitcoin holdings would be secured in cold storage wallets with multi-signature authentication and undergo monthly audits. The state treasurer would be required to conduct purchases through regulated US-based crypto exchanges and explore Bitcoin mining operations to increase holdings.

The bill establishes strict usage restrictions for the reserve, requiring two-thirds approval from both chambers of the General Assembly for any Bitcoin liquidation. Permitted uses include responding to severe financial crises, financing critical infrastructure, funding Bitcoin-related research and education, and backing bonds for public projects.

A Bitcoin Economic Advisory Board comprising industry experts would provide ongoing guidance, while the treasurer would submit quarterly reports on the reserve’s status and performance.

The legislation aims to “position North Carolina as a leader in state-level cryptocurrency adoption” and promote Bitcoin investment as a financial innovation strategy.

SB327 is the second Bitcoin reserve bill introduced in North Carolina.

Earlier last month, state lawmakers unveiled the “NC Digital Assets Investments Act” or HB92, which permits the State Treasurer to invest up to 10% of state funds in digital assets with a minimum average market capitalization of $750 billion.

HB92 passed its first reading on February 12 and was referred to the Committee on Pensions and Retirement earlier this month for further review.