SB1649 sets eligibility through a fair value score, covering stablecoins, NFTs and DigiByte.
Arizona crypto reserve proposition gained major support yesterday, February 16, after Senate Bill 1649 (SB1649) cleared the Senate Finance Committee. The proposal, introduced by Sen. Mark Finchem, passed in a 4-2 vote and now heads to the Senate Rules Committee. The bill would create a Digital Assets Strategic Reserve Fund using seized and confiscated Bitcoin, XRP, and other eligible crypto assets.
Arizona Crypto Reserve Moves Forward With Treasurer-Led Reserve Structure
As per LegiScan data, SB1649 would establish the Digital Assets Strategic Reserve Fund, managed by the Arizona State Treasurer. The fund would include money appropriated by the legislature and digital assets seized, confiscated, or surrendered to the state.
The bill also directs the treasurer to store these assets through secure custody solutions. It allows storage through a qualified custodian or exchange-traded products issued by an investment company registered in Arizona.
Notably, the treasurer would also have the authority to invest money deposited into the crypto reserve. In addition, the bill permits the state to loan digital assets to generate returns, as long as the loan does not increase financial risk.
The Senate fact sheet also notes no anticipated fiscal impact to Arizona’s General Fund. Meanwhile, the Arizona State Board of Investment would continue reviewing investment activities under existing state constitutional rules.
As the bill advances to create the crypto reserve, federal developments could still influence the broader digital asset policy sector. This includes reports that the White House may hold a third meeting this week with crypto and banking leaders.
Eligible Digital Assets Include Bitcoin, XRP, DigiByte, and stablecoins
SB1649 includes specific eligibility rules for what may enter the Arizona crypto reserve. The bill defines digital assets broadly, including virtual currency, virtual coins, and cryptocurrency or native on-chain assets.
However, it also sets a threshold requirement using a “cryptocurrency fair value score.” The bill defines this score as a weighted evaluation of economic and technical vitality, using metrics such as market capitalization and network activity.
Other factors include annual transaction value, development ecosystems, and a “network power source” measure tied to decentralization and security. Assets must reach at least 1% of a defined “digital gold standard benchmark.”
The bill lists Bitcoin, XRP, DigiByte, stablecoins, and non-fungible tokens as included digital assets. It also covers other digital-only assets that provide economic, proprietary, or access rights. Additionally, SB1649 defines key terms such as cryptographic private key and exchange-traded product, which support custody and investment rules.
Bitcoin and XRP Prices Slide as Arizona Bill Advances
As Arizona lawmakers consider the Arizona crypto reserve framework, the digital assets in the bill have declined in recent weeks. Bitcoin value today is at $67,035.93, down 1.84% in the past 24 hours and 29.43% over the past month. Meanwhile, XRP traded at $1.44, down 3.48% in the past day and 29.22% in the past month.
It is worth noting that SB1649 focuses on seized or surrendered assets rather than direct state purchases. The bill also differs from Arizona’s earlier 2025 law, HB 2749, which created a reserve fund tied to unclaimed or abandoned property. The bill’s next step now is with the Senate Rules Committee, following its 4-2-1-0 vote outcome in the Finance Committee.
