Alabama state auditor calls to establish Bitcoin reserve
State Auditor Andrew Sorrell has proposed that Alabama create a strategic Bitcoin (BTC) reserve to ensure its continued leadership in crypto adoption.
He argued that such a move would diversify the states assets, attract crypto-focused businesses, and establish Alabama as a pioneer in the digital asset space.
According to Sorrell:
Crypto is no longer a question of if its here, and its reshaping financial markets worldwide. States that act now will be in a prime position to benefit.
The proposal follows a significant surge in Bitcoins value, which has climbed over 50% since the presidential election.
President-elect Donald Trumps endorsement of Bitcoin, including a campaign pledge to build a federal Bitcoin reserve, has fueled the rally. Trump has also engaged with crypto leaders, signaling the technologys potential role in the national economy.
Alabamas crypto strategy
Sorrell emphasized that adding Bitcoin to Alabamas holdings would position the state for long-term gains. He described crypto as a rapidly growing asset class that offers unique advantages, such as resilience to inflation and independence from the U.S. dollar.
Sorrell said:
A diversified investment strategy should include assets beyond traditional bonds and treasuries. Bitcoin has consistently outperformed other asset classes over the past decade, and Alabama is missing out by not having exposure.
He proposed a gradual approach to acquiring Bitcoin, suggesting the state adopt a dollar-cost-averaging strategy over two years to reduce risks associated with market volatility. He also stressed that any reserve would be safeguarded for critical emergencies rather than routine use.
Investing in Bitcoin isnt about short-term gains. Its about preparing for the future and building a financial safety net for the state.
National trend
Alabamas potential move aligns with growing interest among US states in leveraging crypto for economic stability. Florida and Pennsylvania are reportedly exploring similar strategies, while federal lawmakers, including Senator Cynthia Lummis (R-Wyo.), have introduced legislation to establish a national Bitcoin reserve.
The Securities and Exchange Commissions approval of Bitcoin and Ethereum exchange-traded funds (ETFs) earlier this year has made it easier for states to invest in digital assets. Sorrell pointed to the federal governments existing Bitcoin holdings, valued at billions, as a precedent for Alabamas potential reserve.
According to Sorrel:
Trumps administration plans to retain and expand the federal Bitcoin stockpile, which demonstrates the growing importance of this asset.
By positioning itself as a crypto-friendly state, Sorrell believes Alabama can attract businesses and investors eager to engage with blockchain and digital assets.
He added:
States that adapt to emerging technologies will be the ones to thrive. Alabama has the opportunity to lead and reap the rewards of this innovation.
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