A bill that passed the lower house of the North Carolina General Assembly could lead to the state exploring the feasibility of holding Bitcoin (BTC) as part of its financial portfolio. The bill, which was approved by the North Carolina House of Representatives on June 28, proposes a $50,000 study to examine the potential benefits and risks associated with acquiring, storing, insuring, and liquidating both gold bullion and virtual currencies like Bitcoin.
The study aims to investigate the impact that gold and cryptocurrency holdings would have on North Carolina’s financial stability. Specifically, it will explore whether these assets can serve as a hedge against inflation and systemic credit risks. Additionally, the study will determine if integrating gold and cryptocurrencies into the state’s portfolio can help reduce volatility and increase returns.
The bill also contemplates the establishment of a state-administered depository for cryptocurrencies. This would make North Carolina the custodian of its digital asset holdings. However, the study will also consider the costs and benefits of using a privately managed depository or relying on another state’s depository.
The bill received solid support in the House, with 73 votes in favor, 40 against, and seven absent. However, for it to become law, it must now pass the Senate and obtain the approval of Governor Roy Cooper, who could either sign it into law or veto it.
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This development in North Carolina follows a previous bill passed by the state’s House unanimously on May 3. That bill aimed to ban payments to the state using a central bank digital currency (CBDC). It also prohibited the United States Federal Reserve from using North Carolina as a test ground for any future pilot CBDC.
Just a day prior to that, on May 2, the Board of Commissioners for Buncombe County in North Carolina approved a one-year moratorium on crypto mining. This decision was likely in response to concerns over the environmental impact of cryptocurrency mining.
The passage of the bill in North Carolina’s House reveals a growing trend of states in the United States exploring the potential benefits of cryptocurrencies and blockchain technology. While some states have been more proactive in embracing these innovations, others have taken a cautious approach.
This development also reflects broader global interest in cryptocurrencies and their potential impact on traditional financial systems. Governments and financial institutions worldwide are grappling with the need to regulate and integrate cryptocurrencies into their economies, as digital assets continue to gain popularity and acceptance.
By commissioning a study to examine the feasibility and benefits of holding Bitcoin and gold, North Carolina is taking a progressive step towards understanding the potential advantages and drawbacks of incorporating digital assets into its financial strategy. If successful, this study could serve as a model for other states and governments seeking to navigate the evolving landscape of cryptocurrencies.
In conclusion, North Carolina’s House of Representatives has passed a bill that calls for a study on the feasibility and benefits of the state holding Bitcoin and gold. The study aims to assess the potential impact of these assets on inflation, credit risks, volatility, and portfolio returns. If the bill becomes law, North Carolina could become a pioneer in integrating cryptocurrencies into its financial portfolio. The passage of this bill reflects the growing interest in cryptocurrencies and their potential role in reshaping traditional financial systems.
