Lawmakers in Kansas are deliberating on a new piece of legislation aimed at establishing a state-managed reserve for Bitcoin and other digital assets. This initiative, introduced as Senate Bill 352 (SB 352) by Senator Craig Bowser, proposes a novel approach to managing unclaimed digital property by utilizing assets already held by the state, rather than investing taxpayer money in purchasing cryptocurrencies directly.
The funds for this proposed “Bitcoin and digital assets reserve fund” would primarily come from abandoned digital assets, including airdrops and staking rewards. Under the current framework, these assets—which can comprise various cryptocurrencies—are classified as unclaimed when their owners fail to retrieve them within a specified timeframe. The bill outlines a mechanism for how these digital assets will be handled, distinguishing them from cash-based unclaimed property.
Significantly, the proposal indicates that the state would not engage in direct acquisitions of Bitcoin. This aligns with a growing trend among governmental bodies at both the state and federal levels to explore digital asset exposure without making outright purchases on the open market. This strategic shift mirrors similar intentions at the federal level, where discussions have emerged regarding the establishment of a U.S. Strategic Bitcoin Reserve funded through forfeited Bitcoin instead of newly acquired coins.
If SB 352 is enacted, the operational structure of the reserve fund includes the allocation of resources once digital assets are transferred. For instance, ten percent of the deposit would be directed to the Kansas general fund. However, Bitcoin and similar assets would remain within the reserve and could be managed for long-term benefits, potentially allowing for appreciation or yield accumulation.
The legislation comes with updates to the state’s unclaimed property laws, formally defining terms like “digital assets” and “airdrops.” It offers guidance on the custody, management, and accounting of these digital assets once classified as abandoned.
After passing through the Federal and State Affairs Committee, SB 352 is now under consideration by the Senate Committee on Financial Institutions and Insurance. It follows other pioneering cryptocurrency initiatives in Kansas, notably a bill that seeks to permit the Kansas Public Employees Retirement System to allocate a portion of its portfolio—up to 10%—to spot Bitcoin exchange-traded funds. That particular proposal remains in the same committee and is still being assessed.
Kansas joins a number of states across the U.S. that are exploring various forms of crypto-related legislation, including reserve concepts and regulatory frameworks tailored to digital assets. Meanwhile, at the federal level, discussions continue within the current administration about advancing plans for a national Bitcoin reserve funded through seized assets. Internationally, countries like El Salvador and Bhutan have pursued more direct approaches, integrating Bitcoin into their national strategies through state holdings and mining initiatives linked to the growing digital economy.
