Illinois has proposed a bill for a state-run Bitcoin reserve. The state has a goal to use the world’s first crypto as a financial savings technology. As of now, the bill requires a five-year holding period before conversions or sales can proceed.
Illinois State Representative John Cabello introduced House Bill 1844 (HB1844). It proposes creating a strategic Bitcoin (BTC) reserve as a “special fund in the state treasury for the purpose of holding Bitcoin as a financial asset.”
In addition, after the five-year holding period, the state treasury will be allowed to transfer, sell, appropriate, or convert any Bitcoins in the fund to another cryptocurrency.
Illinois is not the first American state working to consider a Bitcoin reserve. Firstly, Texas Lieutenant Governor Dan Patrick announced creating a Bitcoin reserve as a key focus for the state in 2025.
At least five more state legislatures in the US are seeking to establish Bitcoin or crypto reserves. Arizona and Utah strategic reserve bills have advanced out of committee.
Also, US Senator Cynthia Lummis has renewed calls for a strategic Bitcoin reserve. She argued that BTC could serve as a hedge against inflation and financial instability. In a post on X, she confirmed that holding public hearings on the proposal remains a top priority for the Trump administration.
Another milestone for crypto is that the Fed is now in alignment. Fed’s Chair Jerome Powell said that banks are free to serve with crypto, provided they effectively manage the associated risks. He insisted, “The threshold has been a little higher for banks engaging in crypto activities, and that’s because they’re so new.”
He also cleared the air about allegations that crypto companies are having trouble getting banking services in America.
He insists that the Fed doesn’t want to cut off legal users. He explained that the Fed’s job is to look into how banks and crypto are connected by studying the banks: Not the other way around.
A Bitcoin reserve is no longer a conversation of how and why – but a conversation of when and who will be the first. For starters, more institutions are interested in BTC, with mega institutions like BlackRock and Vanguard leading the way.
BTC ETFs have encouraged renewed interest in Bitcoin as a real investment. Bitcoin’s weak connection to standard assets like bonds makes it a good choice for spreading out the bank’s reserves.
In addition, recent changes in US regulations under POTUS Trump have made things better for crypto.