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North Carolina has taken a significant step in the digital asset space by passing two bills that will allow it to invest in cryptocurrencies. The legislation was approved by the state’s House of Representatives, marking a major shift in the country as states begin to explore opportunities in the evolving digital asset market.
The new management structure proposed under the bill would create an independent investment board responsible for making decisions regarding digital assets. This move comes as North Carolina faces a $16 billion deficit in its pension system, which has struggled to produce returns comparable to other states.
Under the new framework, the state will not be able to invest directly in specific cryptocurrencies like Bitcoin, but rather only in crypto equivalents of mutual funds. Before making any investments, an independent third-party assessment would need to confirm secure custody solutions and proper risk oversight.
The bill also includes provisions that allow for exploring ways to enable retirement plan members to opt-in for their accounts to hold digital assets as exchange-traded products.
Despite opposition from some Democratic lawmakers who expressed concerns over cryptocurrency volatility, the majority of representatives supported the measure. However, not everyone is on board with this move; the State Employees Association of North Carolina has voiced its opposition to the bill.
The Governor, Josh Stein, a Democrat, has publicly endorsed the proposal, stating that it is essential for the state to “spread the allocation around.” The Republican representative Keith Kidwell echoed these sentiments, saying that good investment brokers diversify their portfolios, much like this proposed approach would do for the state’s funds.
North Carolina is not alone in its consideration of cryptocurrency investments. Arizona has already made significant strides in this area, with both its House and Senate having passed bills proposing different methods for establishing a state crypto reserve.
In light of these developments, it appears that the country is on the cusp of witnessing a broader trend as governments begin to explore opportunities in digital assets while balancing the potential benefits against the risks inherent in cryptocurrency markets.
Source: https://coincentral.com/north-carolina-bets-on-bitcoin-house-passes-bills-for-state-crypto-investments/
