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Arizona Governor Katie Hobbs has vetoed two crypto-related bills designed to increase the state’s use of digital assets while simultaneously approving a strict law that focuses on regulating crypto ATMs.
In Brief
- Arizona Governor Hobbs vetoed two crypto bills due to concerns about market volatility.
- Hobbs approved House Bill 2387, regulating crypto ATMs with limits and fraud protections.
- Arizona’s cautious approach contrasts with Dubai’s adoption of crypto for government payments.
Governor Hobbs Vetoes Crypto Reserve and Payment Bills Over Risk Concerns
Among the rejected proposals is Senate Bill 1373, which would have created a Digital Assets Strategic Reserve Fund. This fund was intended to let the state hold and manage cryptocurrency obtained through asset seizures or legislative allocations.
Katie Hobbs stated in her veto letter to Senate President Warren Petersen that the current volatility in cryptocurrency markets makes it an imprudent fit for general fund dollars. She added that she has already signed legislation this session that allows the state to utilize cryptocurrency without placing general fund dollars at risk.
This latest development comes after she rejected Senate Bill 1025, the Arizona Strategic Bitcoin Reserve Act. The bill would have allowed the state to invest up to 10% of its treasury and retirement funds into Bitcoin or other cryptocurrencies. Stephen Cole, the co-founder of Orqestr, expressed disappointment, stating that he was disheartened to learn Governor Katie Hobbs had vetoed Arizona’s bitcoin reserve legislation, SB1025.
According to data from Bitcoin Laws, while 26 U.S. states have introduced strategic crypto reserve bills, 18 others are still active. By rejecting this bill, Arizona has now joined the league of other U.S. states that have formally blocked similar legislation.
Furthermore, the Arizona governor also rejected Senate Bill 1024. This bill aimed to allow state agencies to accept cryptocurrency as payment for things like taxes, penaltie and government service fees, using approved payment processors.
The bill included protections to limit the state’s exposure to crypto price swings, likely by having service providers convert crypto to dollars immediately. Still, Hobbs said the approach carried too many uncertainties and potential downsides, leading her to decide not to move forward with it.
Hobbs wrote:
Today, I vetoed Senate Bill 1024. While this bill would allow State agencies to enter into agreements to protect the State from risks associated with cryptocurrency, legislators on both sides of the aisle acknowledged it still leaves the door open for too much risk.
Approved Crypto ATM Law Focuses on Consumer Protection
The sole cryptocurrency bill that received Hobbs’ approval was House Bill 2387, which lays out strict rules for operating crypto kiosks and ATMs. The bill was created with the aim of reducing fraud while also improving transparency.
The bill sets daily limits on crypto kiosk use, with new users restricted to $2,000 per day and returning users allowed up to $10,500 per day after 10 days. It also requires kiosk operators to provide 24/7 toll-free customer support and to display the phone number clearly on every machine.
Moreover, it requires crypto kiosks to show clear warnings in multiple languages about common crypto scams and makes users confirm they understand the risks before completing a transaction. It also stipulates that operators must provide detailed receipts listing transaction details, contact info, fees, and refund terms.
Also on May 7, Hobbs approved House Bill 2749, which updates Arizona’s unclaimed property laws to include digital assets. While her recent vetoes show a cautious approach, this approval suggests she’s not entirely ruling out the role of cryptocurrency in state policy. The bill allows the state to retain unclaimed crypto in its original form, rather than converting it to traditional currency.
Arizona vs. Dubai: Contrasting Global Approaches to Cryptocurrency Adoption
While the Arizona government has rejected the idea of the state using digital assets, Dubai Finance (DOF), on the other hand, has signed a Memorandum of Understanding (MoU) with Crypto.com to enable the payment of government service fees using cryptocurrencies.
The partnership helps Dubai move toward a cashless society by making crypto transactions secure and easy. It allows the government to add a new digital payment option for services, making it simpler and safer to pay using stablecoins.
Hence, one can say that Arizona’s focus on regulation aims to protect consumers and minimize risk, while Dubai’s embrace of crypto for payments shows how digital assets can support innovation. These two approaches show different paths countries can take to shape responsible and forward-looking crypto policies.
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Ifeoluwa specializes in Web3 writing and marketing, with over 5 years of experience creating insightful and strategic content. Beyond this, he trades crypto and is skilled at conducting technical, fundamental, and on-chain analyses.
DISCLAIMER
The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.
