Stellar (xlm) 
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Arizona Governor Katie Hobbs has signed a groundbreaking law that allows the state to take control of unclaimed digital assets, including cryptocurrencies, that have been left inactive for three years or more. This move aims to modernize the state’s approach to unclaimed property and address the growing prominence of digital currencies in the economy.
House Bill 2749: A New Framework for Digital Assets
The announcement came on May 7, following the bipartisan passage of House Bill 2749 in the Arizona state legislature. Sponsored by House Commerce Committee Chairman Jeff Weninger, the new law updates Arizona’s unclaimed property statutes to include virtual assets such as Bitcoin and other cryptocurrencies. It also establishes the “Bitcoin and Digital Assets Reserve Fund,” which will be used for future appropriations with the approval of the legislature.
“Digital assets aren’t the future—they’re the present,” noted Jeff Weninger. “We’ve built a structure that protects property rights, respects ownership, and gives the state tools to account for a new category of value in the economy.”
How the Law Works
Under the provisions of the law, digital assets are classified as abandoned if the owner does not respond to communications or activity requests for a period of three years. Once deemed abandoned, these assets must be transferred to the Arizona Department of Revenue in their original digital form.
The law also allows the state’s qualified custodians to stake these assets or accept airdrops. Any rewards or tokens accrued through staking or airdrops are funneled into the newly created reserve fund. This fund is managed by the state treasurer and operates with legislative oversight, ensuring transparency and accountability.
No Reliance on Taxpayer Money
One of the key features of the Bitcoin and Digital Assets Reserve Fund is that it does not rely on taxpayer money or state funds. Instead, it is entirely funded through proceeds generated by staking rewards and airdropped tokens from the unclaimed digital assets. This ensures that the fund operates independently of public finances while still contributing to the state’s reserves.
A Balanced Approach to Cryptocurrency
This legislative development comes shortly after Governor Hobbs vetoed Senate Bill 1025, which proposed investing seized state funds in Bitcoin. Hobbs expressed concerns about using public money on what she referred to as “untested assets.” However, HB2749 avoids this issue by focusing on unclaimed assets, rather than actively investing state funds.
Arizona’s approach reflects a balanced strategy for engaging with cryptocurrencies. By addressing unclaimed assets rather than risking public funds, the state has created a framework that protects asset owners while modernizing its financial policies to account for digital currencies.
How Arizona Compares to Other States
Arizona’s move follows similar legislation in other states like New Hampshire, which now permits investment in cryptocurrencies with market capitalizations exceeding $500 billion. Currently, Bitcoin is the only cryptocurrency to meet this threshold. These actions suggest a growing trend among states to integrate digital assets into their economic frameworks while implementing safeguards to mitigate risks.
As cryptocurrencies continue to gain traction in mainstream finance, more states may look to Arizona’s model as a template for managing digital assets responsibly. This law represents a significant step toward aligning regulatory frameworks with the realities of an increasingly digital economy.
Key Takeaways
- Arizona’s new law addresses unclaimed digital assets, including cryptocurrencies, left inactive for three years or more.
- House Bill 2749 establishes the Bitcoin and Digital Assets Reserve Fund, funded through staking rewards and airdrops, without relying on taxpayer money.
- The law ensures transparency by placing the fund under legislative oversight and management by the state treasurer.
- This initiative positions Arizona as a leader in integrating digital assets while safeguarding property rights and public funds.
As the cryptocurrency landscape evolves, laws like HB2749 highlight the importance of adapting state policies to address the challenges and opportunities presented by digital assets.
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