The text of SB 327 along with the status of the bill can be found at this link.
As of March 19th, SB 327 had its first reading, and was sent to Committee for action.
Bitcoin is the "gold standard" for cryptocurrencies. For readers who may be unfamiliar or skeptical about Bitcoin, a $1,000 investment in Bitcoin on March 19, 2020 would be worth approximately $14,000 today. The Bitcoin supply is currently increasing slower than the supply of U.S. dollars, and it has a maximum final supply. With the current investment rates in Bitcoin, it is reasonable to expect that it will gain in value compared to the dollar for years or decades to come.
SB 327, The North Carolina Bitcoin Reserve and Investment Act, would empower the N.C. Treasurer to take some interesting actions.
-The Treasure may allocate up to 10% of public funds into Bitcoin (BTC) as part of the State's long-term financial strategy
-The Treasurer is authorized to engage in Bitcoin-backed investment strategies, including staking, lending, and other regulated yield-generating activities.
The second item is perhaps the most interesting, lending and staking Bitcoin means the State can generate significant revenue, over and above the simple appreciation of the asset itself. If a substantial amount of Bitcoin is held by the State, that holding buttresses the value of the Bitcoin itself. Staking and lending revenue could be used to purchase more Bitcoin, creating a flywheel effect, or used to finance public works; potentially offsetting the need for some tax revenue.
It may occur to some County Governments in North Carolina that holding Bitcoin as a long term asset could be used to pay for future projects. There is likely legislation that would need to be enacted, to clarify any legal ambiguities. A Bitcoin reserve at the County level could be used to finance school improvement, infrastructure, or act as collateral for loans or bonds to accomplish the same purpose. A properly structured and managed Bitcoin fund at the County level could also be used to gradually reduce the need for property taxes on residential or agricultural land.
