Texas regulates crypto with a light touch and invests in it with a heavy one. The Department of Banking's position under the Money Services Act treats pure crypto-to-crypto exchange as outside money transmission, while fiat-touching exchange and custody require licensing; HB 1666 (2023) added exchange obligations for platforms serving Texans, requiring customer asset segregation, reserves sufficient to meet withdrawals, and annual reporting. The state's commercial code recognized virtual currency control and perfection early (HB 4474, 2021).
The 2025 session made Texas the first state with a funded, standalone bitcoin reserve: SB 21 established the Texas Strategic Bitcoin Reserve managed by the Comptroller outside the treasury, HB 4488 protected the fund, and the legislature appropriated $10 million for initial purchases. Meanwhile ERCOT's interconnection queue made Texas the center of American mining, with registration requirements for large flexible loads and demand-response programs that pay miners to curtail. The combination, minimal licensing, pro-mining grid policy, sovereign bitcoin exposure, is the fullest expression of the red-state crypto model.
The instruments
HB 1666: exchange reserve and segregation requirements
Digital asset exchanges serving more than a threshold number of Texas customers must segregate customer funds, maintain reserves sufficient to honor withdrawals, avoid commingling, and file annual reports with the Department of Banking.
Texas Strategic Bitcoin Reserve
Creates a special fund outside the treasury for the state to hold bitcoin (limited to assets above a large market-cap threshold), managed by the Comptroller with authority to accept forfeitures and donations; a companion act shields the fund from sweeps, and $10 million was appropriated for purchases.