Arizona governor vetoes bill permitting Bitcoin in retirement funds
Retirement is a common concern for various entities including individuals, businesses, and governments. The stability of retirement funds largely depends on making sound investments, which could be instrumental in fortifying both public and private retirement programs. However, Governor Katie Hobbs of Arizona stands firm in her belief that investing in cryptocurrency is not a suitable option.
In Arizona, Senate Bill 1025 aimed to authorize the state treasurer, the Arizona State Retirement System, and the Public Safety Personnel Retirement System to allocate up to 10% of public funds to virtual currency assets. The bill’s definition of “virtual currency” encompassed digital representations of value that functioned as a medium of exchange, unit of account, and store of value independent of the U.S. dollar or foreign currencies, according to analysis from HousingWire’s Reverse Mortgage Daily.
Although the bill successfully passed through both state legislative chambers, it ultimately landed on Governor Hobbs’ desk for approval. In a recent letter addressed to Warren Petersen, the president of the state Senate, Hobbs expressed her decision to veto Senate Bill 1025. She emphasized the exceptional reputation of the Arizona State Retirement System rooted in making prudent and informed investments. Hobbs asserted that venturing into untested investments like virtual currency was unwarranted for the state’s retirement funds, categorizing them as inherently risky.
The legislation was backed by two Republican lawmakers, Senator Wendy Rogers, and Representative Jeff Weninger. However, the rejection was met with criticism from advocates of cryptocurrencies, some of whom believed that integrating virtual currencies could potentially address deficiencies in the state’s pension system.
While President Donald Trump previously commanded the establishment of a strategic Bitcoin reserve and a digital asset stockpile for the United States, there is still apprehension surrounding the adoption of cryptocurrency. Reports emerging earlier this year indicated that the U.S. Department of Housing and Urban Development (HUD) contemplated utilizing cryptocurrency and blockchain technology for managing agency grants. Despite HUD’s denial of existing plans regarding blockchain or stablecoin implementation, discussions have persisted regarding the risks associated with crypto assets due to their high volatility and the substantial investment risks they entail, according to insights from the Government Accountability Office (GAO).
In light of these considerations, Governor Hobbs’ decision to veto Senate Bill 1025 paints a clear picture of the cautious approach taken by Arizona towards investing public funds in virtual currencies. As the debate surrounding cryptocurrency continues to unfold, the prudence of maintaining a steady and secure retirement fund remains paramount.
