The Texas Senate Business and Commerce Committee reviewed a bill Tuesday that could allow the state to invest in Bitcoin through a new reserve fund. Senate Bill 21, introduced by Sen. Charles Schwertner of Georgetown, proposes the creation of a state-held cryptocurrency reserve limited to assets with a market capitalization exceeding $500 billion—currently only met by Bitcoin.

“We can buy land, we can buy gold; I think the state of Texas should have the option of evaluating the best-performing asset over the last 10 years,” Schwertner said.

Cryptocurrencies are digital assets secured through blockchain technology. Bitcoin, the most valuable cryptocurrency, has increased in price from $500 in 2016 to over $100,000 in recent weeks, with a current market capitalization of approximately $1.8 trillion. The Securities and Exchange Commission (SEC) recently approved exchange-traded funds (ETFs) allowing regulated investment in Bitcoin and other cryptocurrencies.

SB 21 proposes funding the reserve through legislative appropriations and private donations. Schwertner aims to secure a $21 million appropriation to launch the fund, which would be overseen by the Texas Comptroller’s Office. The fund’s performance would be publicly reported every biennium, and disbursements would require legislative approval.

Texas Comptroller Glenn Hegar testified before the committee, noting that his office manages over $100 billion in state investments and is exploring cryptocurrency as a potential addition to the portfolio. Though Texas agencies, including state retirement funds, are currently allowed to invest in SEC-regulated crypto ETFs, no state entity has done so yet.

“Pioneering a strategic Bitcoin reserve is a natural step for Texas, where innovation and ideas are nurtured and pursued,” Hegar said. “We believe this bill takes a measured approach to managing a potentially volatile asset, a critical requirement when investing taxpayer dollars.”

Schwertner emphasized that the bill also serves as a response to federal spending policies, noting that 32 other states are considering similar legislation.

“The federal government can’t continue to spend like this and expect our country to continue to be as prosperous as it was in the past,” Schwertner said.

The bill remains under committee review.