Texas Lawmaker Proposes Limits on Crypto Investments: Details

A new bill introduced in the Texas legislature could restrict how much local and state authorities can invest in Bitcoin and other cryptocurrencies as reserve assets. Filed on March 10 by Representative Ron Reynolds, the bill proposes capping the Texas Economic Stabilization Fund’s cryptocurrency investments at $250 million. It also seeks to prevent municipalities and counties from allocating more than $10 million toward digital assets.

The legislation arrives just days after the Texas Senate approved a separate bill—SB 21—that would establish a strategic Bitcoin reserve for the state. The draft version of SB 21 does not appear to impose any limit on Bitcoin purchases by the Texas comptroller, a stark contrast to Rep. Reynolds’ proposed restrictions.

Texas Bitcoin Reserve Gains Momentum

The push for a state-backed Bitcoin reserve in Texas has gained traction, particularly following the political shift in Washington. After Donald Trump’s return to the presidency and the Republican takeover of both chambers of Congress, several states have introduced bills aimed at integrating Bitcoin into their financial infrastructure. Texas Lieutenant Governor Dan Patrick has publicly supported a plan to create a Texas Bitcoin Reserve, making it a priority for the state’s 2025 legislative session.

However, it remains unclear whether Rep. Reynolds—who belongs to the Democratic Party—intends to support the existing Bitcoin reserve initiative or introduce guardrails to prevent unrestricted government investment in crypto. Should his bill pass, it would take effect on September 1, provided Governor Greg Abbott signs it into law.

Legal Uncertainty in Federal BTC Reserve

The developments in Texas align with a broader national conversation on Bitcoin’s role in government reserves. On March 7, President Trump signed an executive order establishing a federal “Strategic Bitcoin Reserve” and “Digital Asset Stockpile.” However, legal experts have raised questions about the extent of presidential authority to unilaterally implement such policies.

Meanwhile, U.S. lawmakers are taking steps to formalize Bitcoin’s place in federal reserves. Wyoming Senator Cynthia Lummis reintroduced legislation on March 11 to codify the Bitcoin reserve into law, signaling continued political momentum for digital asset adoption.