Arizona digital assets proposal advances as Senate panel backs SB1649 digital reserve plan

Lawmakers in Arizona took a step toward formalizing arizona digital assets policy as a new reserve fund bill cleared its first Senate hurdle.

Arizona Senate Finance backs new digital asset reserve

The Arizona Senate Finance Committee has approved SB1649, a measure that would create a state-run Digital Assets Strategic Reserve Fund. The committee advanced the bill on a 4–2 vote, signaling growing institutional interest in cryptocurrencies at the state level.

Under SB1649, the proposed arizona digital asset fund would hold certain cryptocurrencies and tokens that come into state control. Specifically, it targets digital assets seized surrendered or otherwise surrendered to Arizona authorities, which would then be placed into the new reserve structure.

XRP explicitly named as qualifying reserve asset

The bill’s language explicitly identifies XRP as one of the qualifying assets for the reserve. Moreover, the text clarifies that XRP and other eligible digital instruments may be held when they are seized or voluntarily turned over to the state, ensuring clarity around which tokens can be included.

Importantly, the proposal allows the state treasurer to manage and securely hold those digital holdings. However, the treasurer would be required to follow a defined state treasurer custody plan, using what the legislation describes as regulated custody solutions and exchange-traded products to safeguard and administer the portfolio.

Custody rules and management framework

In practical terms, SB1649 authorizes the treasurer to rely on advanced custody tools and regulated exchange-traded products when overseeing the fund. That said, the measure keeps the reserve under public oversight by placing responsibility with an elected official rather than outsourcing control entirely to private platforms.

Supporters argue the framework is consistent with broader state-level efforts to clarify control over tokens held in government hands. While SB1649 does not amend the arizona revised uniform fiduciary access to digital assets act, it operates alongside those principles by defining how public entities can hold and manage coins such as XRP.

Legislative path through Senate and House

Following the committee’s 4–2 approval, SB1649 now proceeds to the full Arizona Senate for debate and additional votes. If it secures majority support there, the bill will move to the Arizona House for further consideration, where lawmakers could propose amendments or adjustments to the reserve’s design.

The bill’s progress will determine whether the state creates a state digital asset reserve that formally incorporates XRP. Moreover, if enacted as written, the law would see xrp included in reserve holdings whenever the token is seized or surrendered, potentially making Arizona the first U.S. state with a dedicated reserve structure featuring that asset.

In summary, SB1649 positions Arizona to experiment with a state-managed crypto reserve, using structured rules for custody, oversight, and asset eligibility, pending full legislative approval.