Kentucky has become the 16th US state to introduce legislation aimed at establishing a Bitcoin reserve, with the bill KY HB376 introduced by State Representative Theodore Joseph Roberts on Feb. 6. If passed, the bill would allow the State Investment Commission to allocate up to 10% of excess state reserves into digital assets, primarily Bitcoin, given its market cap of $1.9 trillion. This legislation sets Kentucky among states like Alabama and Florida in exploring digital asset reserves. According to Anndy Lian, this could lead to federal-level discussions on Bitcoin classification, highlighting regulatory challenges and consumer protection issues. He noted that while the bill reflects confidence in Bitcoin, it also raises concerns about volatility impacting taxpayers. Moreover, for successful implementation, Kentucky would need to develop strong custody solutions and cybersecurity measures, especially in light of the recent proposal in another state for a minimum five-year BTC holding strategy.

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