State Bill Allows Up to 10% Investment in Digital Assets
Michigan lawmakers are moving closer to establishing a strategic crypto reserve, as the state’s House Bill 4087 advanced to the committee stage this week. The legislation would allow up to 10% of Michigan’s countercyclical budget and stabilization fund to be invested in digital assets.
Michigan’s Crypto Strategy
The bill, introduced in February, amends the Michigan Management and Budget Act and lays out strict rules for how the state can hold and manage crypto assets. While it does not name Bitcoin directly, the measure defines eligible assets as digital currencies using encryption to regulate issuance and transfer without reliance on a central bank.
Under the proposal, assets must be stored via one of three methods:
- A secure custody solution with government-controlled private keys.
- A qualified custodian, such as a bank or trust company.
- Exchange-traded products from registered investment firms.
The legislation also permits Michigan to loan out cryptocurrency to generate returns, provided no additional financial risk is taken.
Support and Opposition
Backers argue that the measure would diversify Michigan’s reserves while preparing the state for the growing digital economy. “By allocating a small portion of reserves into crypto, Michigan is positioning itself at the forefront of financial innovation,” said one Lansing-based financial analyst.
If approved, Michigan would become one of the first U.S. states to actively hold a diversified crypto reserve. With state-level adoption still rare, the bill highlights a growing debate over how governments should balance innovation and financial security in the digital age.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.