Kansas Lawmakers Introduce Bill to Create a State‑Run Bitcoin and Digital Assets Reserve Fund
Senate Bill 352 would channel unclaimed cryptocurrency holdings into a treasury‑managed reserve, with a portion of the value redirected to the state’s general fund.
Legislative proposal
On Thursday, Jan. 22, a coalition of Kansas legislators filed Senate Bill 352, a measure that would establish a “Bitcoin and Digital Assets Reserve Fund” under the oversight of the Kansas State Treasurer. The bill, sponsored by Sen. Craig Bowser, amends existing unclaimed‑property statutes to treat certain crypto holdings—such as Bitcoin, Ethereum, and other digital tokens—identically to traditional assets when they become abandoned.
Key provisions of the bill include:
- Custody and transfer – Digital assets that meet the state’s definition of abandoned property would be transferred to the newly created reserve fund.
- Revenue allocation – The Treasurer would be required to credit 10 percent of each digital‑asset deposit to Kansas’s general fund, while the remaining balance stays in the reserve. The legislation explicitly bars the direct deposit of cryptocurrency into the general fund.
- Governance – The fund would be administered by the State Treasurer’s office, subject to the same appropriation procedures that govern other state‑controlled accounts.
If enacted, the reserve would function primarily as a custodial repository rather than an active investment vehicle. Kansas would thereby capture a modest share of the market value of forfeited crypto while retaining the bulk of the assets for possible future use.
A broader national trend
Kansas is joining a growing cohort of states that are formalizing how public authorities handle digital assets. In 2025, Arizona, Utah and Oklahoma advanced legislation that explicitly earmarked cryptocurrency for strategic treasury reserves, framing digital tokens as a hedge against inflation and a new source of sovereign wealth.
At the federal level, the conversation has taken a more aggressive turn. In March 2025, former President Donald Trump signed an executive order establishing a U.S. Strategic Bitcoin Reserve, directing agencies to retain seized Bitcoin rather than liquidate it at auction. The Treasury now holds roughly 198,000 BTC—valued at more than $17 billion—under that policy. Meanwhile, Rep. Warren Davidson (R‑OH) introduced the “Bitcoin for America Act” in late 2025, which would permit taxpayers to settle federal liabilities in Bitcoin and funnel those proceeds into the strategic reserve.
Kansas’s approach differs in that it does not propose to allocate newly acquired crypto to the state’s operating budget; instead, it seeks to monetize only a fraction of unclaimed holdings while preserving the rest in a dedicated pool.
Potential implications
- Revenue boost – The 10 percent “credit” could generate a modest but steady stream of income for the state, especially as the volume of digital‑asset unclaimed property grows.
- Risk management – By keeping the bulk of assets within a separate fund, Kansas limits exposure to market volatility that could affect the general fund’s fiscal stability.
- Administrative burden – Implementing the new custody framework will require the treasurer’s office to develop or contract for secure storage solutions, compliance monitoring, and valuation protocols for a wide array of tokens.
- Precedent setting – Adoption of the bill could position Kansas as a model for other jurisdictions seeking a low‑risk entry point into public‑sector crypto management.
Key takeaways
| Takeaway | Details |
|---|---|
| Bill aims to create a custodial reserve | Focuses on unclaimed digital assets transferred under existing property laws. |
| Limited revenue share | 10 % of each deposit is earmarked for the general fund; the remainder stays in the reserve. |
| Treasurer‑led oversight | The Kansas State Treasurer will manage the fund, subject to standard appropriation processes. |
| Part of a national shift | Aligns with similar initiatives in Arizona, Utah, Oklahoma, and recent federal strategies. |
| Risk‑averse design | Unlike some state proposals, Kansas does not plan to invest the reserve’s holdings in the general budget. |
| Implementation challenges | Requires secure custody infrastructure, asset valuation mechanisms, and clear rules for “abandoned” status. |
Outlook
Senate Bill 352 is still in its early legislative stage, and its passage will depend on committee reviews and potential amendments. If approved, Kansas would add a modest but strategically significant tool to its fiscal arsenal, capturing value from dormant crypto holdings without exposing core state finances to the volatility inherent in the market. Observers will be watching how the bill navigates practical concerns—such as secure storage and accurate asset appraisal—as well as broader political sentiment toward cryptocurrency in public policy.
Source: https://thedefiant.io/news/regulation/kansas-lawmakers-propose-state-run-bitcoin-and-digital-assets-reserve-fund
