Michigan is moving forward with legislation that could make it one of the few U.S. states to officially invest in cryptocurrencies. House Bill 4087, introduced by Republican Representatives Bryan Posthumus and Ron Robinson, has successfully cleared its second reading and now heads to the Committee on Government Operations for further review. This groundbreaking bill marks a significant development in how states view and utilize digital assets as part of their financial strategy.
A Strategic Investment in Michigan’s Future
If passed, the bill would allow Michigan to invest up to 10% of its countercyclical budget and economic stabilization fund into cryptocurrencies. This move is designed to diversify the state’s financial holdings while potentially increasing returns during periods of economic uncertainty.
The legislation would update the existing Michigan Management and Budget Act to include a clear framework for managing a crypto reserve. It outlines how the state can acquire and store digital assets using regulated custodians, exchange-traded products, or secure custody solutions.
Security is a top priority in the bill. Measures include government-controlled private keys, encrypted storage, multi-party authorization, and regular third-party audits. These provisions aim to minimize risk while maximizing transparency and oversight.
Potential for Lending and Broader Crypto Adoption
The bill also allows Michigan to lend its digital assets, potentially earning additional revenue without exposing the state to unnecessary financial risk. This kind of forward-thinking policy reflects growing confidence in the utility and value of cryptocurrencies within public finance.
Supporters of the legislation argue that this positions Michigan as a leader in digital asset policy, joining states like Massachusetts and Ohio that have also explored crypto reserve strategies. While some Bitcoin advocacy groups have pushed for a Bitcoin-only policy, Michigan’s broader approach indicates a recognition of the wider digital asset ecosystem.
As crypto becomes an increasingly accepted asset class, Michigan’s strategic reserve bill could pave the way for other states to follow suit—modernizing their investment strategies and embracing innovation in the digital economy.
