North Carolina Lawmakers Consider Bitcoin and Gold Investments to Safeguard State Finances

North Carolina senators are considering alternative investments in an effort to strengthen the state’s financial stability, proposing a bill that would fund a full study on digital assets and precious metals. The bill, titled “State Precious Metals Depository Study,” just cleared the state House of Representatives and is now being considered by the Senate. If it receives Senate approval, Governor Roy Cooper’s signature is required to make the bill law. The proposed bill, spearheaded by Republican state Representative Mark Brody, seeks to protect North Carolina’s assets from the projected continuous devaluation of the US currency.

The bill’s primary goal is to determine the possibility of merging digital assets and precious metals into the state’s General Fund—a financial reserve similar to the state’s bank account. The study will look into how holding these alternative assets could potentially reduce portfolio volatility, mitigate inflation, and yield superior long-term returns. A noteworthy factor highlighted in the bill is the awareness of systemic credit concerns, which strengthens the case for Bitcoin and gold inclusion in the state’s asset allocation. In addition, the study will assess the acquisition, secure storage, and liquidation processes for these assets, as well as the prospective development of a state-administered institution in charge of their custody.

Representative Mark Brody worked closely with Dan Spuller, the Blockchain Association’s head of industrial affairs, a key cryptocurrency business advocacy group. Spuller’s experience was critical in structuring the bill’s first focus, which was on the purchase of gold. However, given the MPs’ lack of information on the matter, it was decided to conduct a thorough investigation before making any final conclusions. Spuller appeared before state lawmakers earlier this month, emphasizing the need of adding digital assets in the research.

During the House session, the bill garnered unanimous support from all 67 Republican members present, as well as six Democrats. However, with 40 negative votes, a majority of Democrats opposed the initiative. Despite the opposing views, the law included $50,000 in funding for the complete investigation, with the findings and policy recommendations due to the state’s Joint Legislative Commission on Governmental Operations at the start of the next year.

Representative Mark Brody emphasized the seriousness of the situation, emphasizing the importance of safeguarding the state’s reserve surplus against the threats of inflation. He asked his colleagues to consider the implications of allowing these reserves to erode gradually due to inflation, suggesting that a portion of the funds be assigned to an asset that can effectively protect its value in the face of inflationary pressures.

While North Carolina lawmakers are aggressively investigating the potential benefits of Bitcoin and other digital currencies, opposition has emerged in Buncombe County. In April, county officials suggested a prohibition on Bitcoin mining, which was later passed in May, exemplifying the state’s different attitudes towards bitcoin.