A South Dakota lawmaker has reintroduced legislation that would allow the state to invest a portion of its public funds in Bitcoin, reviving a proposal that stalled during last year’s legislative session.
Key Takeaways:
- A South Dakota bill would allow the state to invest up to 10% of eligible public funds in Bitcoin through multiple exposure options.
- The proposal includes strict custody and security rules for any state-held Bitcoin.
- The effort reflects a broader trend as US states explore Bitcoin-backed reserve strategies.
Republican Representative Logan Manhart introduced House Bill 1155 on Tuesday, seeking to amend South Dakota’s public investment statutes to permit the State Investment Council to allocate up to 10% of eligible state funds to Bitcoin.
The bill would allow exposure through direct holdings, qualified custodians or regulated exchange-traded products.
South Dakota Bitcoin Bill Sets Strict Custody and Security Rules
“I am proud to say I have released my bill that would allow the State of South Dakota to invest in Bitcoin,” Manhart wrote in a post on X. “Strong money. Strong state.”
The proposal outlines detailed custody and security requirements for any state-held Bitcoin.
These include exclusive control of private keys, encrypted hardware storage, geographically distributed secure facilities, multi-party governance controls and regular security audits.
House Bill 1155 has received its first reading and has been referred to the Committee on Commerce and Energy, according to the official legislative journal.
The measure closely resembles House Bill 1202, which Manhart introduced during the 2025 legislative session.
That earlier effort sought to add Bitcoin to the list of permissible state investments but failed to advance after being deferred beyond South Dakota’s 40-day legislative session limit.
The renewed push comes as interest in Bitcoin-backed reserves grows among US states.
Lawmakers in Kansas and Florida have advanced similar proposals, while Arizona, Texas and New Hampshire have already passed legislation allowing some form of crypto reserve strategy.
At the federal level, the US government established a strategic Bitcoin reserve last year following a March executive order signed by President Donald Trump.
The reserve is funded using Bitcoin seized in criminal and civil cases, assets that are legally barred from being sold.
Supporters argue that Bitcoin could serve as a long-term hedge against inflation and currency debasement, while critics have raised concerns about price volatility and risk management.
Kansas Weighs Bitcoin Reserve Fund
As reported, lawmakers in Kansas are considering legislation that would create a state-managed Bitcoin and digital assets reserve funded entirely by unclaimed digital property already held by the state.
Senate Bill 352, introduced by Senator Craig Bowser, proposes establishing a reserve within the state treasury overseen by the Kansas state treasurer, without using taxpayer funds or direct cryptocurrency purchases.
Under the proposal, the reserve would be built from abandoned digital assets such as unclaimed Bitcoin, other cryptocurrencies, airdrops, staking rewards and interest that fall under Kansas’ unclaimed property laws.
The bill specifies that 10% of each deposit would be transferred to the state’s general fund, while Bitcoin would remain locked within the reserve.
Internationally, countries such as El Salvador and Bhutan have already taken more direct approaches, incorporating Bitcoin into national strategies through state holdings, mining initiatives, and development projects tied to digital assets.
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