Arizona’s House Bill 2324 (HB 2324), a controversial measure seeking to create a reserve of Bitcoin and other digital assets using proceeds from criminal forfeitures, has failed to become law after being vetoed by Governor Katie Hobbs on July 1.
In her veto statement, Hobbs expressed concern that the bill would disincentivize local law enforcement cooperation in cases involving digital asset seizures. The proposed legislation would have redirected a significant portion of seized crypto funds away from local agencies, shifting control to the state.
HB 2324 sought to establish a Bitcoin and Digital Assets Reserve Fund, composed exclusively of crypto seized in criminal investigations. Under the proposed framework, the first $300,000 in proceeds would be allocated to the Attorney General’s Office, with any remaining funds split as follows:
The bill, revived last month, moved swiftly through the legislature. It passed the Senate and was approved by the House in a 34–22 vote just last week.
However, the veto was largely anticipated, as Governor Hobbs has previously blocked multiple crypto-related initiatives. Earlier measures she vetoed include:
To date, Arizona has passed only HB 2749, making it the second U.S. state, after New Hampshire, to enact legislation addressing unclaimed crypto assets presumed to be abandoned.
The rejection of HB 2324 highlights the growing divide between state legislators pushing for crypto integration and an executive branch more cautious about digital asset policy.
July 2025, Cryptoniteuae