Republican House leader Derek Merrin introduced a new cryptocurrency bill in Ohio. The bill, known as the Ohio Bitcoin Reserve Act (HB 703), proposes the establishment of a Bitcoin fund within the state's treasury. 

This makes Ohio the third state in the U.S. to propose such a move in just over a month, following the lead of other state representatives advocating for Bitcoin's role in government reserves.

The Ohio Bitcoin Reserve Act

Introduced in December 2024, the Ohio Bitcoin Reserve Act is designed to grant the state treasurer the authority to purchase Bitcoin as part of Ohio's asset allocation strategy. Per reports, the bill will serve as a foundation for Ohio's next legislative session, coming just two weeks before the 135th General Assembly is set to adjourn on December 31.

While the bill does not mandate specific Bitcoin purchases, it provides the flexibility for the state to consider Bitcoin as a part of its portfolio when making investment decisions.

"The U.S. Dollar is being rapidly devalued, and our State Treasurer should have the authority and flexibility to invest in Bitcoin when determining proper asset allocation," Merrin stated. 

He argued that Bitcoin could serve as a safeguard against the diminishing value of the U.S. Dollar, which he sees as an ongoing threat to the state's financial health.

In his statement, Merrin emphasized that the bill was not just about protecting the state’s finances but also about embracing technological advancements. His vision for the bill is to ensure the state government can utilize Bitcoin to enhance its long-term financial position and withstand inflationary pressures.

The Bill's Provisions and Potential Impact

The bill amends sections of Ohio’s Revised Code to create a dedicated Bitcoin fund within the state treasury. However, it does not force the state to make any Bitcoin purchases. Instead, the bill provides the State Treasurer with discretionary power, allowing the office to decide if and when to invest in Bitcoin as part of its financial strategy.

This level of flexibility means that while the state could allocate a portion of its treasury to Bitcoin, it wouldn’t be required to do so. Merrin believes that this approach could allow Ohio to strengthen its financial portfolio and preserve public funds from losing value due to inflation.

Merrin also anticipates that a national Bitcoin reserve program could be developed in the future, citing a proposal by Senator Cynthia Lummis of Wyoming, who has long been a vocal supporter of Bitcoin as a national reserve asset.

A Growing Trend Across the U.S.

Ohio’s push to establish a Bitcoin fund is part of a larger movement in U.S. states, with several others following suit. In November 2024, Pennsylvania introduced the Bitcoin Strategic Reserve Act, which would allocate up to 10% of the state’s treasury to Bitcoin as a hedge against inflation. ‘

Texas also joined the movement in December with House Bill 1598, proposing the creation of a strategic Bitcoin reserve funded through donations, and allowing state agencies to accept Bitcoin for payments.

Advocates believe that by adding Bitcoin to a state’s portfolio, governments can bolster their financial strength and hedge against inflationary risks. This could lead to more corporate adoption of digital assets and strengthen Bitcoin’s position in the broader financial system.

Ohio's Fiscal Strategy and Bitcoin Adoption

Ohio’s financial situation has long been a concern, with the state carrying a public debt of $72.16 billion as of 2022. The majority of this debt comes from general obligation bonds and special obligation bonds issued to fund infrastructure projects, education, and public services. 

Should the bill pass and Bitcoin be added to Ohio’s treasury, it could provide the state with an alternative asset class to improve its fiscal position. Over time, this strategy could reduce the pressure to raise taxes or cut essential services, allowing the state to fulfill its obligations more efficiently.

Furthermore, as Bitcoin gains mainstream acceptance, including it in state reserves could signal broader legitimacy for digital assets in global finance.