Florida Senator provides a legislative template to invest up to 10% of public funds in Bitcoin and Crypto

Florida officially wants to make Bitcoin (BTC) part of his financial strategy. If a recently submitted draft law is successful by Senator Joe Gruder's draft law, the state will begin investing its public funds in BTC. The plan is to use Bitcoin to protect the money reserves from inflation and the financial policy that could weaken the total value of the state coffers.

The legislation adopted to support Bitcoin could be optimistic for the crypto industry in the state and encourage companies and dealers to integrate crypto payments with Fiat. For example, e-commerce platforms of the official list of accepted payment methods can add crypto for simpler payments. In addition, players and casino lovers can enjoy an anonymous games at no converification casinos supported by Bitcoin payments. These casinos without KYC (know that your customer) are becoming increasingly popular because they offer great game options, exciting bonuses and fast transactions and at the same time maintain the player's anonymity via crypto.

Photo of André François McKenzie To Unplash

With the title SB 550, the legislation states that inflation has already reduced the purchasing power of assets from the Chief Financial Officer of the state. The loss of value has an adverse effect on the financial stability and the economic security of the state and has a negative impact on the residents and taxpayers. While Florida has no control over the federal monitoring policy that affect inflation, SB 550 states that Florida is responsible for protecting its resources from inflation.

Gruder's draft law tries to invest Florida's Chief Financial Officer in Bitcoin and cryptocurrencies. However, there are no other options.

“The Chief Financial Officer can include Bitcoin and other digital assets in order to serve as value storage and to provide protection against inflation, which protects the purchasing power of state funds.”

In addition, the law indicates that the CFO in Bitcoin can invest in Bitcoin with money from the General Revenue Fund, the budget stabilization fund and several others. However, it limits the amount of public funds invested in Bitcoin to a maximum of 10%.

SB 550 argues that Bitcoin is a good choice, since its value has increased considerably enough that the asset has become an accepted medium of international exchange. The invoice also notes that several countries now have official Bitcoin reserves.

In order to protect Florida's Bitcoin Holdings, the applied custody solution has to meet several criteria. First, the cryptographic private keys to the wallet must only be kept by a government company, encrypted and never accessible via a smartphone. The hardware that contains these keys must be kept in “at least two geographically different, safe data centers”.

In addition, the company that offers the technology product must ensure a multi-party governance structure for the transaction permit and a disaster recovery protocol, which guarantees access if necessary. In addition, the product must be subjected to regular penetration tests and code audits to provide the service. If problems or weaknesses are found, they must be remedied immediately.

When the legislation passes and becomes the law, Florida will join a growing list of US states that are interested in Bitcoin and the crypto sector in general. On the day before the introduction of Gruders, Kentucky was the 16th state, which submitted laws for cryptoinvestment.

Kentucky Rep. Theodore Joseph Roberts submitted Ky HB376 to invest the state investment commission in cryptocurrencies. As in Florida, the invoice also indicates a maximum of 10% and does not indicate which cryptocurrencies should be acquired. However, it is said that the assets should not be stable cos that had an average market capitalization of more than $ 750 billion last year. CoinmarketCAP data show that Bitcoin is the only crypto that meets this criterion with a market capitalization of 1.9 trillion dollars.

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