digital assets strategic reserve fund

SB1649 - 572R - S Ver

Senate Engrossed

digital assets
strategic reserve fund

State of Arizona

Senate

Fifty-seventh Legislature

Second Regular Session

2026

SENATE BILL 1649

AN
ACT

amending title 41, chapter 1, article 4,
Arizona Revised Statutes, by adding section 41-181; AMENDING section 44-308,
Arizona Revised Statutes; relating to the state treasurer.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it
enacted by the Legislature of the State of Arizona:

Section 1. Title 41, chapter 1, article 4,
Arizona Revised Statutes, is amended by adding section 41-181, to read:

START_STATUTE
41-181.

Digital assets
strategic reserve fund
; deposits; definitions

A. The
digital
assets strategic reserve fund
is established consisting of digital assets
that are
held by, confiscated by or surrendered to this
state. The state treasurer shall deposit digital assets that are
held by this state in the fund through the use of a secure custody
solution by a qualified custodian or in a form of an exchange-traded
product that is issued by an investment company registered in this
state. The state treasurer shall administer the fund.

B. The state treasurer may invest the
total amount of monies deposited in the fund in any fiscal year.

C. The state treasurer may loan
digital assets from the fund to generate additional returns If the loan does
not increase any financial risks to this state.

D. For the purposes of this section:

1. "Cryptocurrency fair
value" means A weighted evaluation of a coin's economic and technical
vitality using performance metrics, including:

(
a
)
Adoption by coin owners.

(
b
)
annual transactions.

(
c
) Annual
transaction value.

(
d
) Development
ecosystems.

2. "Cryptographic private
key" means a secret key used to encrypt and decrypt data.

3. "Digital asset"
includes:

(
a
) Virtual
currency.

(
b
) Virtual
coins.

(
c
) Cryptocurrency
or native on-chain assets that meet the
cryptocurrency
fair value score of one percent of the digital gold standard benchmark,
including any of the following:

(
i
) Bitcoin.

(
ii
) Digibyte.

(
iii
) XRP.

(
iv
) Stablecoin.

(
v
) A
nonfungible token.

(
vi
) Dash.

(
vii
) EGLD.

(
viii
) Internet
computer.

(
ix
) Near.

(
x
) Ravencoin.

(
xi
) Chia.

(
xii
) Ecash.

(
xiii
) Monero.

(
xiv
) Nano.

(
xv
) Any other
digital-only assets that confer economic, proprietary or access rights or
powers.

4. "Exchange-traded
product" means a financial instrument that is traded on a United States-regulated
exchange, that derives value from an underlying pool of assets, including
stocks, bonds, commodities or indexes, and that is approved by any of the
following:

(
a
) The United
States securities and exchange commission.

(
b
) The
commodities futures trading commission.

(
c
) The
department of Insurance and financial institutions.

5. "Qualified custodian"
means
either of the following:

(
a
) a federal
or state-chartered bank, trust company or special purpose depository
institution or a company regulated by this state that has custody of virtual
currency for an approved exchange-traded product.

(
b
) A
technology provider of a secure custody solution.

6. "Secure custody
solution" means a technological product or a blended product or service
that meets all of the following:

(
a
) Has a
cryptographic private key that secures a digital asset and that is exclusively
known by and accessible by a governmental entity.

(
b
) Has a
cryptographic private key
that secures a digital
asset, that is exclusively contained within an encrypted ENVIRONMENT and that
is accessible only through an end-to-end encrypted channel.

(
c
) Has a
cryptographic private key that secures a digital asset that is never contained
by, accessible by or controllable through a smartphone.

(
d
) Has
hardware that contains a cryptographic private key that secures a digital asset
and that is maintained in at least two geographically diversified AND specially
designated secure data centers.

(
e
) Enforces a
multiparty governance structure for authorizing a transaction and user access
controls.

(
f
) Logs each
user-initiated action.

(
g
) Undergoes
regular code audits and penetration testing from an auditing firm, which
ensures that a vulnerability identified by the auditing firm is promptly
remedied.

(
h
) Is provided
by an entity that has implemented a disaster recovery protocol to ensure
customers have access to the digital assets if the entity is unAVAILABLE.

7. "Virtual coin" has the
same meaning prescribed in section 44-1801.

END_STATUTE

Sec. 2. Section 44-308, Arizona Revised Statutes, is amended to read:

START_STATUTE
44-308.

Payment or delivery of abandoned property; definitions

A. On filing the
report prescribed in section 44-307, the holder of property that is
presumed abandoned shall pay, deliver or cause to be paid or delivered to the
department the property described in the report as unclaimed. If the
property is an automatically renewable deposit and a penalty or forfeiture in
the payment of interest would result, the time for compliance is extended until
a penalty or forfeiture would no longer result. The holder of
tangible property held in a safe deposit box or any other safekeeping
depository shall deliver the property to the department on filing the report
prescribed in section 44-307.

B. If the property reported to the department is a
security or security entitlement pursuant to title 47, chapter 8, the
department may make an endorsement, instruction or entitlement order on behalf
of the apparent owner to invoke the duty of the issuer or its transfer agent or
the securities intermediary to transfer or dispose of the security or the
security entitlement in accordance with title 47, chapter 8.

C. If the holder of property reported to the
department is the issuer of a certificated security, the department has the
right to obtain a replacement certificate pursuant to section 47-8405, but an
indemnity bond is not required.

D. If the property reported to the department is a
digital asset, the holder shall report and deliver the digital asset in its
native form to the department or the department's designated qualified
custodian within thirty days after reporting the property
abandoned. On direction by the department, the qualified custodian
may stake to receive rewards or receive airdrops. On the expiration
of three years after the date the digital asset was transferred to the
qualified custodian and if the property remains unclaimed, any airdrops or
staking rewards shall be transferred to the bitcoin and digital
asset

assets
reserve fund established by section 41-180. If
the holder only possesses a partial private key to the digital asset or is
unable to move the digital asset, the holder shall maintain the digital asset until
the additional keys required to transfer the digital asset become
available.
For the purposes of this subsection,
"qualified custodian" means any of the following that is licensed in
this state to sell
digital assets and offer custody
services to customers:

1. A company.

2. A federal or state
chartered bank.

3. A trust company.

4. A special purpose depository
institution.

E. An issuer, the
holder and any transfer agent or other person who acts pursuant to the
instructions and on behalf of the issuer or holder in accordance with this
section are not liable to the apparent owner and are indemnified against all claims
of any person in accordance with section 44-310.

F. Each month a holder of property reported pursuant
to section 44-307, subsection H shall remit the property with the report
of property presumed abandoned or other form prescribed by the department.

G. For the purposes of this section:

1. "qualified custodian"
means either of the following:

(
a
) any of the
following that is licensed in this state to sell digital assets and offer
custody services to customers:

(
i
) A company.

(
ii
) A federal
or state-chartered bank.

(
iii
) A trust
company.

(
iv
) A special
purpose depository institution.

(
b
) A
technology provider of a secure custody solution.

2. "Secure custody
solution" has the same meaning PRESCRIBED in section 41-181.
END_STATUTE

Sec. 3.
Legislative
findings

The legislature finds that:

1. The digital gold
standard benchmark is a standard to provide security and stability in the
marketplace. The digital gold standard benchmark was established
when the market valued the first cryptocurrency at $100,000 per coin.

2. The cryptocurrency fair
value metrics form a universal benchmark and not a testimony to any single
coin's supremacy. Like gold's role in 19th century trade, the
metrics set a standard for all digital gold blockchain-based coins with
decentralized, scarce and transferable attributes.

3. The cryptocurrency fair
value ensures competition is truthful, transparent and fair and evaluates each
coin's performance metrics against the digital gold standard benchmark,
revealing whether its fundamental measurements support its price or signal
overvaluation.

4. The cryptocurrency fair
value model, a cornerstone of informed cryptocurrency investing, calculates a
coin's fair market capitalization by comparing its performance and market
metrics to the digital gold standard, then drives a per-coin fair value by
dividing market capitalization by its circulating supply.