Texas Bitcoin Reserve to Shift From ETF to BTC Custody

Texas is seeking a custody and liquidity provider to help move its Strategic Bitcoin Reserve from BlackRock’s iShares Bitcoin Trust (IBIT) spot Bitcoin exchange-traded fund (ETF) into directly held coins, according to a state procurement document.

The move, posted May 7 and announced in a Thursday release from the Texas Comptroller’s office, would move Texas closer to directly held Bitcoin through a third-party custody arrangement rather than relying solely on ETF exposure, marking a shift from ETF exposure to direct onchain ownership.

Texas has allocated $10 million to the Strategic Bitcoin Reserve, which the state has used to buy IBIT as an interim way to hold the funds before shifting to directly custodied Bitcoin, according to the request for proposals document.

The Comptroller’s office said the winning firm will be responsible for acquiring, holding, managing and reporting the state’s Bitcoin and any other qualifying cryptocurrency holdings, leaving the door open to assets beyond BTC over time.

RFP issued by the Texas Comptroller of Public Accounts. Source: Texas Comptroller

The mandate covers secure custody of digital assets in the name of the State of Texas, liquidity services to facilitate purchases and sales, and a transition plan that would shift existing IBIT holdings into directly custodied Bitcoin within 60 days of contract execution.

The RFP goes beyond basic safekeeping, requiring institutional-grade security controls, standard and custom reporting, and a dedicated public website showing how much Bitcoin and other qualifying cryptocurrencies the reserve holds and what they are worth.

Related: Crypto-backed candidates win key Texas primary runoffs

Texas Comptroller names strategic Bitcoin reserve committee members

The request for proposals was highlighted in a statement from Acting Comptroller Kelly Hancock announcing the members of the Texas Strategic Bitcoin Reserve Advisory Committee.

The panel includes veteran investment executive Laurie Dotter, Cormint Data Systems founder and CEO Jamie McAvity, Southern Methodist University law professor and digital asset scholar Carla Reyes, and CleanSpark president and chief financial officer Gary Vecchiarelli.

The committee is tasked with advising on how the reserve is run, including custody arrangements, risk management and how the state discloses its holdings and performance to lawmakers and the public, as well as broader governance of the reserve’s investment strategy.

Supporters of the law that created the reserve have pitched Bitcoin, and potentially other large-cap cryptocurrencies, as a strategic asset that can help hedge against inflation and economic volatility over time.

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