Hobbs Dashes Hopes with Swift Veto of Three Crypto Bills in Just Two Weeks

By Matthew Holloway |

Arizona Governor Katie Hobbs has taken a firm stance on cryptocurrency regulation, vetoing three bills within days that aimed to expand virtual currency operations in the state. This follows a trend seen in other states like Florida and Louisiana, which have embraced cryptocurrency legislation more openly.

Despite these vetoes, Hobbs did approve HB2387, imposing stricter regulations on Bitcoin ATMs, and HB2749, permitting the state to classify cryptocurrency as unclaimed property. Specific legislation vetoed included SB1025, SB1024, and SB1373, all proposed on the premise of allowing greater state involvement in cryptocurrency investments and transactions.

SB1025 would have authorized the Arizona State Retirement System to invest up to 10% of its funds in virtual assets, while SB1024 sought to permit state agencies to partner with cryptocurrency service providers for accepting payments. SB1373 aimed at establishing the Digital Assets Strategic Reserve Fund for managing these investments.

In her rationale, Hobbs emphasized the risks linked to the current volatility in cryptocurrency markets. In her letters to Senate President Warren Petersen, she categorized these legislative measures as “untested” and highlighted her intent to maintain conservative fiscal policies. “Current volatility in cryptocurrency markets does not make a prudent fit for general fund dollars,” she stated in her veto of Senate Bill 1373.

Regarding SB1025, she remarked, “Arizonans’ retirement funds are not the place for the state to try untested investments like virtual currency.” For SB1024, she expressed concerns that the proposed agreements would still expose the state to excessive risk.

House Bill 2387, introduced by Rep. David Marshall (R-LD7), focuses on combating Crypto ATM fraud by setting a daily transaction limit and requiring state operator licenses alongside a refund policy.

Matthew Holloway is a senior reporter for AZ Free News.