Michigan has advanced its strategic crypto reserve bill, marking a significant step in embracing digital assets. House Bill 4087, introduced by Republican Representatives Bryan Posthumus and Ron Robinson, cleared its second reading on Thursday and is now with the Committee on Government Operations. The proposal would allow the state to invest up to 10% of its “countercyclical budget” and “economic stabilization fund” in cryptocurrencies.

The legislation updates the Michigan Management and Budget Act to create clear guidelines for holding a strategic crypto reserve. It permits the state to secure assets through approved custodians, exchange-traded products, or highly regulated custody solutions. Lawmakers also outlined strict security standards, including government-controlled private keys, encrypted storage, multiparty authorization, and regular audits. The state could even lend digital assets to earn extra returns without added financial risk.

Supporters see the move as forward-looking, putting Michigan alongside Massachusetts and Ohio in advancing crypto reserve legislation. While some Bitcoin advocacy groups argue the bill should be Bitcoin-only, the broader inclusion of crypto highlights growing recognition of digital assets in U.S. state policy.