Bill Text: MI HB4087 | 2025-2026 | 103rd Legislature | Introduced
Bill Title: State finance: other; strategic bitcoin reserve; establish. Amends sec. 351 of 1984 PA 431 (MCL 18.1351) by adding sec. 351a.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced) 2025-02-18 - Bill Electronically Reproduced 02/13/2025 [HB4087 Detail]
Download: Michigan-2025-HB4087-Introduced.html
HOUSE BILL NO. 4087
A bill to amend 1984 PA 431, entitled
"The management and budget act,"
by amending section 351 (MCL 18.1351) and by adding section 351a.
the people of the state of michigan enact:
Sec. 351. (1) A Subject to section 351a, a countercyclical budget and economic stabilization fund is created to assist in stabilizing revenue and employment during periods of economic recession and high unemployment.
(2) As used in this section and sections 352 to 359, "fund" means the countercyclical budget and economic stabilization fund.
(3) As used in section 352, "current calendar year" means the year that ends December 31 in which the determination of the transfer into or out of the fund is being made.
Sec. 351a. (1) Subject to subsection (2), the state treasurer may invest money from any of the following funds in cryptocurrency:
(a) The general fund.
(b) The countercyclical budget and economic stabilization fund created under section 351.
(2) The state treasurer shall not invest greater than 10% of the available funds in each fund described under subsection (1) in cryptocurrency.
(3) The state treasurer shall transfer any taxes paid or fees generated to this state in the form of cryptocurrency to the general fund, and if the payment or fees generated in the form of cryptocurrency were designated to a fund other than the general fund, the state treasurer shall reimburse that fund from the general fund in the form of money in the amount paid or fees generated.
(4) Cryptocurrency held by this state in a fund described in subsection (1) must be held directly by the state treasurer through any of the following means:
(a) A secure custody solution.
(b) A qualified custodian.
(c) An exchange-traded product issued by a registered investment company.
(5) If cryptocurrency can be loaned without increasing the financial risk to this state, the state treasurer is permitted to loan the cryptocurrency to yield further return to this state through rules promulgated by the state treasurer under the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328.
(6) As used in this section:
(a) "Cryptocurrency" means digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, and that operates independently of a central bank.
(b) "Exchange-traded product (ETP)" means any financial instrument that is approved by the United States Securities and Exchange Commission or the United States Commodities Future Trading Commission that is traded on a United States regulated exchange and derives its value from an underlying pool of assets, including, but not limited to, stocks, bonds, commodities, or indexes.
(c) "Private key" means a unique element of cryptographic data used for signing transactions on a blockchain that is known to the owner of the private key.
(d) "Qualified custodian" means either of the following:
(i) A federal or state-chartered bank, trust company, or special purpose depository institution.
(ii) A company regulated by this state that keeps in custody cryptocurrency for an approved exchange-traded product.
(e) "Secure custody solution" means a technological product or blended product and service that has all the following characteristics:
(i) Includes cryptographic private keys that secure cryptocurrency that are exclusively known by and accessible to a governmental entity.
(ii) Includes cryptographic private keys that secure cryptocurrency exclusively contained within an encrypted environment and accessible only via end-to-end encrypted channels.
(iii) Includes cryptographic private keys that secure cryptocurrency that are never contained by, accessible by, or controllable through a smartphone.
(iv) Ensures that any hardware that contains the cryptographic private keys and that secures cryptocurrency is maintained in at least 2 geographically diversified, specially designated secure data centers.
(v) Enforces a multi-party governance structure for authorizing transactions, enforces user access controls, and logs all user-initiated actions.
(vi) Its provider has implemented a disaster recovery protocol that ensures customer access to assets in the event the provider becomes unavailable.
(vii) Undergoes regular code audits and penetration testing from audit firms, and any identified vulnerabilities are promptly remedied.
