Texas Bill Would Allow Municipal Bitcoin Investments of Up to $10 Million

A Texas lawmaker introduced legislation on Monday that would permit individual cities and counties across the state to allocate as much as $10 million in public funds to bitcoin or other cryptocurrencies, with no specified custody requirements.

House Bill 815, authored by Rep. Ron Reynolds, a Democrat from Missouri City, was submitted on the first day of prefiling for the 90th Texas Legislature. Its title reads “Relating to the authority of a municipality or county to invest money in cryptocurrencies.” The proposed legislation, made available on the Texas Legislature’s website, consists of two sections.

The measure seeks to amend the Public Funds Investment Act, found in Chapter 2256 of the Texas Government Code, by inserting a new provision labeled Section 2256.0165, “Authorized Investments: Cryptocurrency.” This section would allow a municipality or county to invest up to $10 million of its own funds, or funds under its control, in bitcoin or another cryptocurrency. If enacted, the authority would become effective Sept. 1, 2027.

The $10 million limit applies to each city or county individually, not as a combined state total. School districts and other local government entities covered by the investment act are not included.

What the bill does and does not say

The legislation adopts its definitions of “Bitcoin” and “cryptocurrency” from Section 403.701 of the Government Code, which were written into law last year through Senate Bill 21, the legislation that established the Texas Strategic Bitcoin Reserve. Bitcoin is described as a decentralized cryptocurrency created by a peer-to-peer network operating independently of any central authority or bank. Cryptocurrency is defined more broadly as a virtual currency leveraging cryptography to secure transactions recorded on a distributed ledger, like a blockchain.

This means a city or county would not be restricted solely to bitcoin. The bill also does not incorporate the reserve law’s requirement that coins purchased for the state fund must have an average market capitalization of at least $500 billion over the preceding 24-month period, nor does it include its stipulations regarding cold storage and qualified custodians.

The Public Funds Investment Act already mandates that local governments adopt a written investment policy emphasizing principal safety and liquidity, and that they invest with the caution a prudent person would exercise in managing their own affairs. A city or county would still need to add cryptocurrency to that policy before making any purchases. The new section itself says nothing about custody, audits specific to digital assets, or how a loss would be addressed.

A narrower version of last year’s proposal

Reynolds previously filed a more expansive measure, House Bill 4258, on March 10, 2025, alongside Rep. Mihaela Plesa. That bill would have allowed the state comptroller to invest up to $250 million from the Economic Stabilization Fund—the state’s rainy day fund—in bitcoin or another cryptocurrency, and it also contained the $10 million cap for cities and counties. It was assigned to the House Delivery of Government Efficiency Committee on April 1, 2025, but did not become law.

House Bill 815 removes the rainy day fund provisions and retains only the local-government component. The state’s own reserve was created separately through Senate Bill 21, which Gov. Greg Abbott signed in June 2025.

The Texas Comptroller’s office later purchased $5 million of BlackRock’s iShares Bitcoin Trust on Nov. 20, 2025, as a placeholder while it developed direct custody arrangements, The Texas Tribune reported, with the office confirming the transaction. A subsequent purchase increased the reserve’s IBIT holdings to approximately $10 million. In May, Acting Comptroller Kelly Hancock appointed an advisory committee and issued a request for proposals for a custodian, moving toward holding bitcoin directly.

What comes next

Prefiling for the 90th Texas Legislature began Monday, and the regular session is scheduled to start Jan. 12, 2027. The bill has been filed but has not yet been assigned to a committee, a step that typically occurs once lawmakers convene. Even if it passes both chambers and receives the governor’s signature, cities and counties would not be able to use the new authority until Sept. 1, 2027.