A Texas lawmaker has proposed a bill that could limit the amount of cryptocurrency that local and state authorities can invest as a reserve asset. The bill, filed on March 10 by Representative Ron Reynolds, suggests that the state’s comptroller should not invest more than $250 million of its Economic Stabilization Fund, also known as a “rainy day” fund, in Bitcoin (BTC) or other cryptocurrencies. Additionally, the legislation proposes a limit of $10 million for Texas municipalities or counties to invest in crypto.

This proposal comes after the Texas Senate passed a bill on March 6 to establish a strategic Bitcoin reserve in the state. The SB 21 bill, if passed, would allow the Texas comptroller to have no limit on purchasing BTC for a reserve.

The plan for a strategic Bitcoin reserve in Texas is one of many separate bills proposed in US state governments following the inauguration of President Donald Trump and Republican lawmakers winning control of the US House of Representatives and Senate. In January, Texas Lieutenant Governor Dan Patrick announced that the state’s legislative priorities for 2025 would include a proposal to establish a Texas Bitcoin Reserve.

It is unclear if Representative Reynolds, a Democrat, intended to support the BTC reserve bill introduced by State Senator Charles Schwertner, a Republican, or propose restrictions in the event the legislation becomes law. However, if passed and signed by Governor Greg Abbott, the bill would take effect on September 1.

While Trump signed an executive order on March 7 to create a federal “Strategic Bitcoin Reserve” and “Digital Asset Stockpile,” legal experts have questioned the US president’s authority to enact specific policies through executive orders. In response, Wyoming Senator Cynthia Lummis reintroduced legislation on March 11 to codify the proposed BTC reserve into law in the Senate.

It is worth noting that there may be a partisan divide on state and federal crypto plans, as Reynolds is a Democrat and Schwertner is a Republican. However, the potential for a strategic Bitcoin reserve in Texas and other states shows a growing interest in cryptocurrency as a reserve asset. As the industry continues to evolve and gain mainstream acceptance, it will be interesting to see how these proposed bills and reserves play out in the future.