Kansas Lawmakers Are Mulling A Bill To Create A Bitcoin, Altcoin Reserve

• Kansas lawmakers have just introduced Senate Bill 352 to build a state reserve from abandoned digital property.
• The proposal treats Bitcoin differently by preventing its transfer into the state general fund.
• Kansas is expected to join states like Texas and New Hampshire in comparing frameworks for crypto treasuries.

Kansas lawmakers recently introduced a bill to create a state managed Bitcoin and digital assets reserve fund. 

This plan does not involve the state buying coins with taxpayer money. Instead, it uses the existing unclaimed property framework. 

In essence, the bill was created to turn abandoned digital tokens into a resource for the state treasury. 

Managing the Digital Assets Reserve Fund

The proposed law is expected to put the state treasurer in charge of the new Bitcoin and digital assets reserve fund. 

Administration would also fall under the state’s unclaimed property rules. 

Usually, the state takes control of assets that owners leave untouched for a long period, and a digital asset is presumed abandoned after three years of inactivity. This window is shorter than the five years used for standard bank accounts, and if an owner fails to log in or move their coins, the state steps in.

Once the state takes custody, a qualified custodian holds the assets, and the bill explicitly allows the state to earn rewards from staking or even airdrops from these holdings.

Rules for Bitcoin and General Fund Transfers

The bill points out a clear difference between different types of tokens. For example, It treats Bitcoin as a special category within the Bitcoin reserve fund. 

For most digital assets, the treasurer must send 10% of the deposits to the state general fund. 

However, the bill strictly prohibits Bitcoin from being moved there. This rule makes sure that Bitcoin remains protected within the dedicated reserve. 

It also shows a desire to keep the most famous digital asset separate from daily state spending.

Owners still have the right to claim their original abandoned property, and only the secondary rewards (like interest or airdrops) move permanently into the state reserve after three years. 

Transparency and Oversight for State Crypto Holdings

Holding digital coins on a public balance sheet has its fair share of challenges. Industry experts warn that price swings can create a “headline risk” for politicians. 

Moreover, weak management of private keys or poor oversight could lead to theft or loss, and experts say that Kansas should treat this like any other form of public money. 

This means that the state should publish clear rules and limits for the new venture

High transparency would help maintain public trust, and supporters say that the state should publish its wallet addresses on the blockchain. This would allow any citizen to verify the holdings in real time. 

Regular reports and independent audits would also be necessary because if the state holds these assets on-chain, the public expects a clear record of every move. 

The Growing Trend of State-Level Bitcoin Reserves

Kansas is not the only state moving in this direction. A small group of jurisdictions has already passed similar laws, including New Hampshire, which enacted its Strategic Bitcoin Reserve law last May. 

That law allows the treasurer to hold coins with a market cap above $500 billion and Texas followed shortly after by permitting Bitcoin as part of its reserve structure. Arizona also passed a law that lets the state keep seized or unclaimed crypto in its original form.

Other states are currently debating their own versions of these bills, and both Florida and West Virginia have proposals ready for their 2026 sessions. 

West Virginia might even allow up to 10% of state funds to go into Bitcoin and precious metals. 

These moves show that local governments want to diversify their wealth, and they are looking beyond traditional bonds and cash.

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