Cryptocurrency surges beyond $99,000 as two US states establish Bitcoin reserves in legislation
In a significant shift for the financial industry, US banks and national banks have been given the green light to provide cryptocurrency custody services for their customers, according to recent announcements from the Office of the Comptroller of the Currency (OCC). This policy change marks a departure from the stricter permissions imposed during the Biden era, paving the way for a more significant expansion of crypto activities within regulated banks while maintaining strict risk controls.
The news has provided banks with much-needed legal certainty when dealing with cryptocurrencies, enabling them to buy and sell cryptocurrencies and assets for their customers. This development has been met with a surge in the Bitcoin price, with a surge from around 94,000 dollars to its current 99,750 dollars.
Meanwhile, states are also exploring the potential of cryptocurrencies. New Hampshire has become the first US state to actively create a Bitcoin reserve, following the signing of HB 302 law on May 6th by Governor Kelly Ayotte. The law allows the government to create a strategic reserve in precious metals or digital assets, with a maximum investment of 5% of public funds, equivalent to almost $65 billion. The law permits investment in gold, silver, and Bitcoin, with potential future inclusion of Ethereum or platinum if their market capitalization remains above $500 billion.
However, the situation in Arizona is less clear. Two bills were introduced to create a Bitcoin reserve, but the exact details of the implementation are somewhat unclear. One of the bills, SB1025, proposed a Bitcoin reserve with up to 10% of the state's budget, but was vetoed by Senator Katie Hobbs. The funding source for Arizona's Bitcoin reserve is defined as 'budget-neutral' and includes unclaimed cryptocurrencies, uncashed checks, unpaid dividends, bonds, unclaimed insurance payouts, and more.
The news sets the stage for developing formal rules for secure custody of cryptocurrencies. Ripple has applied for a national trust bank charter that would enable it to custody digital assets and manage stablecoin payments officially like a bank, pending regulatory approval expected in late 2025. This regulatory evolution, including legislative actions like the GENIUS Act for stablecoins, indicates a more structured framework for integrating cryptocurrencies into the US financial system, likely fostering broader institutional participation and setting precedents for future crypto market regulation.
Dennis Porter of the Satoshi Action Funds claims to have contributed to the New Hampshire Bitcoin reserve model. The exact details of how this will change things are hard to predict at this time, but it's clear that the landscape of financial regulation is evolving rapidly in response to the growing importance of cryptocurrencies.
As the price of Bitcoin continues to surge, the chance to buy Bitcoin under 100,000 dollars may soon be gone. It remains to be seen how these developments will impact the broader crypto market and the financial industry as a whole.
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