‘Magic money': Arizona Republicans advance bills to legitimize cryptocurrency
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Republican measures aimed at bolstering cryptocurrency usage in the state by deeming it 'legal tender' and creating a 'strategic reserve' moved forward, despite concerns over volatility and the lawmakers connections to the cryptocurrency world.
Those connections to crypto were on full display, and ultimately a source of humor for state representatives as they plowed ahead on embracing cryptocurrencies.
'I hope I'm not advertising here, but now would be a good time to invest in XRP and Bitcoin,' Sen. Mark Finchem, R-Prescott, said as his colleagues on the House Commerce Committee laughed while he testified in support of his legislation, Senate Bill 1373.
That legislation, which is similar to another Republican-backed bill that was heard in committee on Tuesday, is part of a larger GOP push to legitimize cryptocurrency in the Grand Canyon State.
The bills mirror moves by 22 other states that have introduced similar legislation authorizing the state treasurer or state pension funds to invest in cryptocurrency, often dubbed the 'Strategic Bitcoin Reserve Act.' The state-level actions come as President Donald Trump, who was backed by crypto investors during the 2024 campaign, has pushed for similar proposals regarding cryptocurrency at the federal level.
The Arizona legislation would create a 'digital assets strategic reserve fund' that would be funded both by the state budget and through cryptocurrencies the state seizes. The state treasurer would administer the fund, and would be allowed to invest up to 10% of the fund's value each year.
Cryptocurrencies are digital money that have no innate value. Unlike gold or oil, which have practical uses and intrinsic value, crypto's chief uses are for speculation and gambling — and as tools for money launderers, ransomware extortionists, tax evaders, terrorists and rogue states.
Just last month, Finchem was speaking at an event held by conspiracy theorists who have been promoting the XRP coin, which Finchem mentioned multiple times during the committee hearing Tuesday.
The event's host, Mel Carmine, claimed God told him to push the cryptocurrency by having it appear to him in the clouds. He also has been accused of being behind a number of fraudulent XRP schemes.
At the event, Finchem called XRP his 'favorite' of all the digital coins, according to reporting by Arizona Right Wing Watch. Finchem also promoted SB1373 and his other cryptocurrency legislation at the event, and, as noted by Arizona Right Wing Watch, has previously published his intent to make XRP a 'legal tender' in a letter on disgraced former Republican lawmaker David Stringer's news website.
Finchem directly mentioned XRP when testifying in support of his Senate Bill 1062. State law currently defers to legal tenders authorized by the U.S. Constitution and Congress, but Finchem's proposal would go beyond that. It would make cryptocurrency a form of 'legal tender' that could be used in the state, as well as any coins made of gold or silver — not just coins issued by the U.S. mint. The bill's language specifically mentions XRP, among other cryptocurrencies.
County treasurers told lawmakers that they had no way to actually implement using or accepting cryptocurrencies.
'We don't have a mechanism to deal with that as a payment method,' Megan Kintner, a lobbyist for the Arizona Association of Counties speaking on behalf of the County Treasurers, said.
Kintner explained that their concern would be that, by the time they are able to accept the payment, the value of the currency will have changed. Cryptocurrencies are notoriously volatile, fluctuating wildly, making them a risky investment.
'If you wanted to convert your Bitcoin into cash, we would gladly accept that,' Kintner added.
Republican lawmakers were not swayed by the concerns, though, and felt that they needed to jump on this new technology bandwagon — even as they made clear they didn't understand what cryptocurrencies are or how they work.
'I don't know much about this, what I call magic money,' Rep. Walt Blackman, R-Snowflake said. 'We think about the debit card. There is nothing behind the debit card but magic and somebody had to innovate behind that… Maybe this will become the new debit card.'
Finchem's legislation that would make cryptocurrency a legal tender passed out of committee along party lines and will head to the full House of Representatives for consideration. If it passes the full chamber, it will head to Gov. Katie Hobbs.
The strategic bitcoin reserve bills, which have largely been pushed by groups behind Project 2025 who have intentions of dismantling the Environmental Protection Agency, passed along party lines as well.
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