South Dakota Republican Rep. Logan Manhart has introduced House Bill 1155, a landmark proposal aimed at integrating cryptocurrency into the state’s investment portfolio.

Filed during the 101st Legislative Session, the bill would authorize the State Investment Council to invest up to 10% of public funds in Bitcoin (BTC), potentially positioning South Dakota among the first U.S. states to embrace cryptocurrency at the state level.

Security and Governance Measures

House Bill 1155 emphasizes secure and responsible management of digital assets.

Proposed options for holding Bitcoin include direct custody by the State Investment Council through advanced secure storage, entrusting funds to a qualified third-party custodian, or acquisition via exchange-traded products (ETPs) issued by registered investment companies.

The bill mandates strict security protocols. Private keys would remain under the exclusive control of the Investment Council and stored in encrypted, hardware-secured environments across at least two geographically separated locations.

Transaction approvals would require multi-party governance to prevent unilateral transfers.

Comprehensive user access controls, audit logs, regular code audits, penetration testing, and disaster recovery measures are also required.

Manhart highlighted the significance of the legislation on social media platform X, stating:

“I am proud to say I have released my bill that would allow the State of South Dakota to invest in Bitcoin. Strong money. Strong state.”

Part of a Growing Trend

South Dakota’s proposal reflects a broader trend of state-level cryptocurrency adoption.

Rhode Island recently introduced Senate Bill S2021, offering a temporary exemption from state income and capital gains taxes for small Bitcoin transactions, capped at $5,000 monthly and $20,000 annually.

The pilot program will run from January 1, 2027, to January 1, 2028, aiming to reduce tax friction on everyday Bitcoin use.

New Hampshire made history in May 2025 by allowing its treasury to invest in Bitcoin and other large-cap digital assets under House Bill 302, permitting allocations of up to 5% of designated public funds.

These initiatives signal rising interest among U.S. states in leveraging digital assets for economic development, financial innovation, and portfolio diversification.