Arizona Governor Katie Hobbs has vetoed the Arizona Strategic Bitcoin Reserve Act, a bill that would have allowed the state to hold Bitcoin in its treasury reserves. Signed on May 2, the veto quickly drew criticism from Bitcoin supporters, including lawmakers and industry leaders.
The bill aimed to enable Arizona to invest certain state-seized funds into Bitcoin, establishing a reserve system managed by public finance authorities. Hobbs rejected the proposal citing financial risk and volatility, which she argued made the asset unsuitable for public funds.
Crypto Advocates Push Back Against the Decision
The veto triggered swift backlash from the crypto community. Jameson Lopp, co-founder of Casa, predicted that the decision “will age poorly.” Anthony Pompliano, a leading Bitcoin advocate, questioned Hobbs’ judgment on investment decisions, adding, “If she can’t outperform Bitcoin, she should just buy it.”
Senator Wendy Rogers, a co-sponsor of the bill, expressed frustration, promising to reintroduce the proposal in the next legislative session. “Arizona needs Bitcoin — not the other way around,” she said, pointing out that the state already indirectly holds exposure through MicroStrategy stock in its retirement system.
Crypto attorney Andrew Gordon echoed the sentiment, calling for “more elected officials who understand the future of crypto.”
Divergent Views from Traditional Economists
Not all financial voices opposed the veto. Veteran gold advocate Peter Schiff supported Governor Hobbs, arguing that public funds should not be used for speculative investments like Bitcoin.
Had it passed, Arizona would have been the first U.S. state to hold Bitcoin in its treasury. Similar proposals have been introduced — and failed — in other states including South Dakota, Oklahoma, and Wyoming.
Bitcoin Remains a Corporate Favorite, If Not a Government One
Despite skepticism at the government level, public companies continue to accumulate Bitcoin aggressively. MicroStrategy, led by Michael Saylor, recently doubled its capital raise to $84 billion to buy more Bitcoin.
In Q1 2025 alone, corporate Bitcoin holdings rose 16.1%, reflecting ongoing institutional conviction in the asset despite market swings. Meanwhile, BitMEX co-founder Arthur Hayes noted that the U.S. federal government is unlikely to build a formal strategic Bitcoin reserve due to its debt burdens and a political culture that still associates Bitcoin with fringe finance.
