Kansas Introduces Bill to Shield Bitcoin From State’s General Fund Transfers

Kansas Senator Craig Bowser introduced legislation on Jan. 21 that would create a state Bitcoin BTC $88 781 24h volatility: 0.6% Market cap: $1.77 T Vol. 24h: $39.11 B reserve through unclaimed digital assets.

The bill explicitly shields Bitcoin from transfer to the state’s general fund. It takes a custody-focused approach rather than authorizing direct cryptocurrency purchases with state funds.

Senate Bill 352 establishes a “Bitcoin and digital assets reserve fund” administered by the Kansas State Treasurer, according to the official bill text.

The legislation amends Kansas unclaimed property statutes to include digital assets, with a three-year abandonment period before the state can claim dormant cryptocurrency holdings.

The bill’s most distinctive provision creates a two-tier treatment for digital assets. Non-Bitcoin digital assets would see 10% of each deposit credited to the state general fund.

Bitcoin receives explicit protection under Section 1(b), which states the treasurer “shall not deposit bitcoin in the state general fund.”

Custody Framework and Staking Provisions

Digital assets reported as abandoned must be delivered to a qualified custodian within 30 days. The bill defines qualified custodians as entities licensed to sell digital assets and offer custody services in Kansas. These include chartered banks and trust companies.

The legislation permits custodians to stake digital assets and receive airdrops.

Staking means earning rewards by locking up crypto to secure a blockchain network, while airdrops are free token distributions.

After three years, these proceeds transfer to the reserve fund if the property remains unclaimed.

State Reserve Movement Context

Kansas joins a growing number of states pursuing Bitcoin reserves. President Trump signed an executive order in March 2025 establishing a federal Strategic Bitcoin Reserve.

The federal reserve has since expanded to over 326,000 BTC following additional seizures.

The Kansas approach differs significantly from Texas, which became the first state to make a direct Bitcoin purchase on Nov. 20, 2025.

Texas acquired $5 million in Bitcoin through BlackRock’s iShares Bitcoin Trust at $91,336 per coin under its Strategic Bitcoin Reserve program.

SB 352 was referred to committee on Jan. 22. The unclaimed property approach follows a similar structure to Arizona’s HB 2749, signed into law in May 2025.

Three states have enacted reserve legislation, with 17 additional states considering similar measures.

Bowser previously sponsored SB 34 in January 2025 to allow the Kansas Public Employees Retirement System (KPERS) to invest in Bitcoin ETFs, but the bill remains in committee with no further action.

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