Florida’s Senate Bill 550 proposes allowing the state to invest in Bitcoin to hedge against inflation, marking a significant step toward cryptocurrency adoption in public finance.
Legislation Seeks to Hedge Against Inflation
Florida is considering a major shift in its financial strategy with a new bill that would allow the state to invest public funds in Bitcoin. Senate Bill 550 (SB 550), filed by State Senator Joe Gruters on February 7, 2025, proposes granting the state’s Chief Financial Officer (CFO) the authority to allocate a portion of state funds to digital assets.
The bill argues that Bitcoin can serve as a hedge against inflation and protect the purchasing power of state funds. According to the bill text:
The chief financial officer may include bitcoin and other digital assets to serve as stores of value and provide a hedge against inflation, thereby protecting the purchasing power of state funds.
How Florida Plans to Hold Bitcoin
SB 550 outlines three ways in which Florida could manage Bitcoin investments:
- Direct Custody – Holding Bitcoin securely through a state-managed solution.
- Qualified Custodian – Using a regulated third party to manage holdings.
- Exchange-Traded Products – Investing through SEC-approved Bitcoin ETFs.
The bill also includes a provision allowing the CFO to loan Bitcoin under specific conditions, as long as the state does not take on additional financial risk.
Investment Limits and Payment Provisions
To manage risk, SB 550 caps Bitcoin investments at 10% of the total funds in any state account. If enacted, the legislation would also permit Florida to accept taxes and fees in Bitcoin, with payments being converted into U.S. dollars and deposited into the General Revenue Fund.
Part of a Growing Trend
Florida is not the only state exploring Bitcoin adoption. Arizona, North Carolina, and South Dakota have also considered similar measures to integrate digital assets into their financial reserves. These initiatives reflect a growing belief that Bitcoin could serve as a financial safeguard against economic instability.
What’s Next?
If passed, SB 550 would position Florida as a leader in state-level cryptocurrency adoption, setting a precedent for other states considering similar policies. Lawmakers and financial experts will closely watch its progress as the debate over digital assets in public finance continues.
Stay updated on SB 550’s progress and its potential impact on Florida’s financial future. Follow legislative updates to see how states are integrating Bitcoin into their economic strategies.
