Minnesota Senator Introduces Bitcoin Act to Allow State Investment in Cryptocurrency

Minnesota Bitcoin Act Proposes State Crypto Investments, Tax Exemptions, and Bitcoin Payment Options

  • Minnesota Senator Jeremy Miller introduces the Minnesota Bitcoin Act, allowing state investment in cryptocurrencies and tax payments using Bitcoin.
  • The bill would exempt crypto investment gains from state income taxes and permit state employees to include digital assets in retirement accounts.
  • This legislation joins similar initiatives across 23 US states, following federal proposals to establish Bitcoin reserves at the national level.

Minnesota is poised to join a growing number of US states embracing cryptocurrency adoption through legislative action. State Senator Jeremy Miller has introduced the Minnesota Bitcoin Act, legislation designed to position the state as a leader in digital asset integration after the lawmaker experienced a complete reversal in his stance on cryptocurrency.

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“As I do more research on cryptocurrency and hear from more and more constituents, I’ve gone from being highly skeptical to learning more about it, to believing in Bitcoin and other cryptocurrencies,” Miller said in his March 18 statement introducing the legislation.

The comprehensive bill would authorize the Minnesota State Board of Investment to allocate state assets to Bitcoin and other cryptocurrencies alongside traditional investments. This approach mirrors investment strategies already being considered in numerous other states, with data from Bitcoin Laws showing that 23 states have introduced legislation to establish Bitcoin reserves, with 39 distinct bills currently under consideration nationwide.

Beyond state-level investments, Miller’s proposal contains several provisions aimed at everyday Minnesotans. State employees would gain the option to include cryptocurrencies in their retirement portfolios, while residents could use Bitcoin to pay state taxes and fees – a capability already implemented in Colorado and Utah for tax payments, and in Louisiana for various state services.

In a potentially significant tax benefit, the legislation would exempt cryptocurrency investment gains from state income taxes. This provision could offer substantial savings, especially considering the current federal tax structure allows deductions of up to $10,000 paid to states through the state and local tax deduction, with amounts exceeding this threshold subject to both state and federal taxation.

The Minnesota initiative emerges amid increasing federal-level interest in cryptocurrency reserves. Senator Cynthia Lummis initially proposed the Strategic Bitcoin Reserve Act in July, directing the federal government to purchase 200,000 Bitcoin annually over five years. More recently, on March 12, Lummis reintroduced a modified BITCOIN Act that could potentially expand federal holdings beyond the originally proposed 1 million Bitcoin target.

The growing legislative interest in Bitcoin coincides with its remarkable performance compared to traditional investments. Data from Curvo reveals that between August 2011 and January 2025, Bitcoin achieved a compound annual growth rate of 102.36%, dramatically outpacing the S&P 500’s 14.83% during the same period.

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