A Texas House representative introduced legislation on Monday that would give every city and county in the state the power to allocate up to $10 million of public funds into Bitcoin or other digital assets. The proposal, House Bill 815, was filed by Democrat Rep. Ron Reynolds of Missouri City as part of the prefiling process for the 90th Texas Legislature. If the bill clears both chambers and is signed, the new authority would take effect on Sept. 1, 2027.

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Key Provisions of the Bill

The bill amends the Public Funds Investment Act (Chapter 2256 of the Texas Government Code) by adding Section 2256.0165, titled “Authorized Investments: Cryptocurrency.” Under this addition, a municipality or county may invest not more than $10 million of its money or money under its control in Bitcoin or another cryptocurrency. The $10 million cap applies per local government, not as a statewide aggregate. The measure adopts the definitions of “Bitcoin” and “cryptocurrency” from Senate Bill 21, which created the Texas Strategic Bitcoin Reserve, but it does not import the reserve’s market‑cap requirement of $500 billion or its custodial safeguards.

What the Bill Leaves Out

Unlike the state‑level reserve law, House Bill 815 is silent on how digital assets must be stored, audited, or handled in the event of loss. It also does not require a qualified custodian or specify cold‑storage protocols. Local governments would still need to amend their existing written investment policies—required by the Public Funds Investment Act—to include cryptocurrency, and they must meet the standard of prudence that a reasonable person would apply to personal investments. School districts and other local entities covered by the act are excluded from the new authority.

Context and Legislative History

The proposal follows an earlier, broader effort by Rep. Reynolds and Rep. Mihaela Plesa (House Bill 4258, filed March 2025) that sought to let the state comptroller invest up to $250 million of the Economic Stabilization Fund in crypto, alongside the same $10 million cap for municipalities. That bill stalled in committee and never became law. In June 2025, Gov. Greg Abbott signed Senate Bill 21, establishing the Texas Strategic Bitcoin Reserve, and the comptroller’s office subsequently purchased roughly $10 million of BlackRock’s iShares Bitcoin Trust as a placeholder while it pursues direct custody solutions.

What to Watch Next

The bill has been filed but not yet assigned to a committee; its progress will depend on committee referrals and legislative priorities when the regular session convenes on Jan. 12, 2027. Stakeholders will be watching for any amendments that address custody, audit or loss‑mitigation requirements, as well as potential opposition from fiscal watchdogs concerned about exposure to volatile assets. If enacted, the law could set a precedent for municipal crypto investment across the United States.