A South Dakota lawmaker named Logan Manhart has reintroduced a bill, which was put on hold around a year ago. He revived the House Bill 1155 to allow the state invest up to 10% of eligible public funds in Bitcoin. Logan Manhart, a Republican member of the South Dakota House of Representatives, introduced the ‘Bitcoin Receive’ bill on Tuesday in the state legislature. The bill proposed by Manhart mandates advanced custody rules, improved private key control, encrypted hardware storage, and regular security audits. The revived initiative from the South Dakota lawmaker came after a failed attempt in the previous year’s legislative session amid the rising demand for BTC-backed reserves.
According to the filing, the proposal would permit the state to allocate up to 10% of eligible public funds into Bitcoin, the world’s largest cryptocurrency by market capitalization, through a range of investment options. The proposal indicates that the United States is actively exploring digital asset-backed reserve strategies. Following the bill introduction, Manhart said that he was proud to have introduced a bill that would allow the State of South Dakota to invest in Bitcoin, describing it as “strong money” and adding that it would help build a strong state.
The newly proposed bill aims to amend the existing legislation to enable state public funds invest in BTC alongside traditional securities and investments. As per the filing, the Bitcoin must be held directly by the Council, through a qualified custodian, or in exchange-traded products. The filing stated that the State Investment Council’s investment in Bitcoin may not exceed 10% of the state funds available for investment. It added that any Bitcoin acquired must be held either directly by the council using a secure custody solution, through a qualified custodian acting on its behalf, or in the form of an exchange-traded product issued by a registered investment company.
South Dakota Proposal Highlights Custody Solutions State Bitcoin Reserve Initiatives
The proposal put forward by Logan Manhart includes provisions for secure custody solutions. It proposed that the private key be exclusively controlled by the State Investment Council and stored within an encrypted, hardware-secured environment, used only to sign and authorize cryptocurrency transactions through end-to-end encrypted channels. It also specified the inclusion of passwordless non-asset keys for authentication and transaction authorization, provided those keys are stored on government devices. In addition, the proposal required that any hardware containing the private key be maintained in at least two geographically diverse, secure data centers, and that the custody solution enforce multi-party governance, strict user access controls, and comprehensive logging of all user-initiated actions.
Lawmakers in Kansas and Florida have already introduced similar proposals to allow states to establish Bitcoin strategic reserves. Meanwhile, several states across the U.S., including Arizona, Texas, and New Hampshire, have passed legislation supporting crypto reserve regulations. Latest reports suggest that Kansas is considering a bill to establish a state-managed reserve for Bitcoin and other digital assets, funded not through open-market purchases but by using unclaimed cryptocurrency and staking rewards. The proposal is seen as a potential precedent for how states could manage digital assets in the future, introducing a new layer of security and innovation into public fund management. Last year, the U.S. federal government also introduced a strategic bitcoin reserve, and this stockpile is funded using bitcoin seized in criminal and civil proceedings.
