U.S. State of Michigan Joins Growing List Considering Strategic Crypto Reserves

Michigan is the latest flashpoint, after lawmakers advanced a proposal this week that would allow the state to invest part of its reserves in digital assets.

A National Experiment

Over the past year, legislation around “strategic crypto reserves” has appeared in more than a dozen states. Texas, Arizona, and New Hampshire have already passed laws allowing treasurers to hold Bitcoin, while states like Wyoming and Pennsylvania have rejected similar measures. Dozens more, from Massachusetts to Montana, have bills pending or in committee.

Michigan’s move puts it alongside Ohio and Massachusetts in the group of states where proposals have cleared early hurdles but have not yet been enacted.

Michigan’s Proposal

House Bill 4087, introduced by Republican lawmakers Bryan Posthumus and Ron Robinson, would permit the treasurer to place up to 10% of two stabilization funds into cryptocurrency. Custody would be tightly regulated, with options including state-controlled storage, federally regulated custodians, or exchange-traded products. The bill even allows the state to lend out its holdings to earn extra income, provided risk exposure does not increase.

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A Fight Over Bitcoin-Only vs. Broad Crypto

The most heated pushback has come not from traditional opponents of crypto but from Bitcoin advocates themselves. The Michigan Bitcoin Trade Council argues the proposal is too broad, since it does not specify market-cap requirements or limit reserves to Bitcoin. In their view, permitting “any digital currency” exposes taxpayer money to weaker, more centralized projects.

For lawmakers, the broad language may be deliberate – leaving flexibility for the treasurer while future-proofing the law against rapid changes in the crypto landscape.

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What’s at Stake

The debate in Michigan mirrors the national conversation: is Bitcoin the only safe long-term reserve asset, or should states diversify into multiple cryptocurrencies? Advocates frame the bill as a way to prepare for economic shocks and keep Michigan competitive in financial innovation. Critics warn it risks gambling with public funds.

With the bill now in the Committee on Government Operations, Michigan faces the same question as other states: whether adding digital assets to public balance sheets represents fiscal innovation – or unnecessary risk.

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