South Dakota kills Bitcoin Reserve plans – ‘Will be back next year’

• South Dakota halted its Bitcoin investment bill due to volatility and regulatory concerns.
• Other states like Florida and Arizona are considering similar Bitcoin reserve legislations.

In a recent move, South Dakota has hit a roadblock in its potential journey toward Bitcoin [BTC] adoption, as lawmakers decided to halt progress on a bill that could have allowed the state to invest in the cryptocurrency.

South Dakota takes a step back

During a meeting on the 24th of February, the state’s House Commerce and Energy Committee voted to defer HB 1202 to the 41st day of the legislative session—a move that effectively killed the proposal, since the session lasts only 40 days.

The bill, introduced by State Representative Logan Manhart on the 30th of January, aimed to amend existing regulations to permit up to 10% of South Dakota’s public funds to be invested in Bitcoin.

Despite this setback, Manhart has announced plans to reintroduce the legislation in 2026, keeping hopes alive for the state’s future involvement in the evolving digital asset space.

Source: Logan Manhart/X

South Dakota’s move mirrors recent developments in Montana, where the House decisively struck down a similar legislation with a 41-59 outcome.

Possible concerns from the lawmakers

The decision to defer HB 1202 in South Dakota largely stemmed from concerns over Bitcoin’s inherent price volatility and the absence of clear federal regulations.

Critics of the bill argued that allocating public funds to such a highly unpredictable asset could pose significant financial risks.

Matt Clark, South Dakota’s State Investment Officer, echoed these sentiments by questioning Bitcoin’s lack of intrinsic value and highlighting the potential dangers of exposing state investments to extreme market fluctuations.

Clark said, 

“Bitcoin does not have any underlying physical use. It does not generate income, much like commodities or other kinds of assets.”

Other states’ status in the Bitcoin Reserve race

While HB 1202 ultimately failed, the conversation around state-held Bitcoin reserves is far from over.

States like Florida, Missouri, and Arizona are already exploring similar legislative efforts, signaling that the debate over integrating Bitcoin into public financial strategies is likely to intensify in the coming years.

Hence, it remains to be seen how the landscape will evolve, with various states exploring Bitcoin reserves and Donald Trump’s vision of establishing a strategic Bitcoin reserve in the U.S. gaining momentum.