Tennessee Strategic Bitcoin Reserve Act (SB 2639)

SB 2639 framed Bitcoin as a decentralized digital commodity with limited supply and continuous global liquidity. The bill’s findings stated that inflation can reduce the purchasing power of state-held assets and that a fiduciary investor may diversify a long-horizon public portfolio into such a commodity. The operative intent was permissive rather than mandatory: it would have authorized, but not required, the Tennessee State Treasurer to allocate a limited portion of eligible state funds to Bitcoin, subject to custody, security, and reporting safeguards.

The bill would have allowed the Treasurer to invest money from the general fund, the revenue fluctuation reserve, and any other state fund expressly designated by the General Assembly. At purchase, Bitcoin held in or for each eligible fund could not exceed 10% of that fund’s total assets. The bill also would have limited acquisitions to 5% of a fund’s assets in a single fiscal year until the 10% ceiling was reached, while allowing passive appreciation above the cap unless the Treasurer directed otherwise.

SB 2639 was limited to Bitcoin. It defined Bitcoin separately from cryptocurrency and digital commodity, and stated that the proposed part would not authorize public funds to be invested in any digital asset, digital commodity, or cryptocurrency other than Bitcoin. It also allowed three holding routes: direct state custody through a secure custody solution, custody by a qualified custodian, or exposure through a U.S.-regulated exchange-traded product deriving value exclusively from underlying Bitcoin.

The custody provisions were detailed for a state-level crypto bill. A secure custody solution would have needed encrypted, non-network-connected hardware in at least two geographically distinct secure facilities; encrypted channels; multi-party governance; role-based controls; immutable audit logs; annual third-party code review and penetration testing; and disaster-recovery testing. Any qualified custodian would have needed ongoing supervision by its primary banking regulator, a recent SOC 2 Type II report, and insurance coverage commensurate with assets under custody.

The proposal also barred any single private person or private entity from holding or controlling a full private key or key shard that could unilaterally transfer state-owned Bitcoin. By July 1, 2028, the Treasurer would have had to design and maintain an internal self-custody process, and once operational, hold at least 10% of aggregate state-owned Bitcoin through that procedure.

SB 2639 was introduced on February 2, 2026 by Senator Kerry Roberts and was recommended for passage by the Senate Commerce and Labor Committee on March 10 with an 8-0 vote and one member not voting. The Senate bill’s last recorded action was placement on the Senate Finance, Ways and Means Committee calendar for April 21. The House companion, HB 1695, was taken off notice in the House Finance, Ways and Means Subcommittee on April 15.

If enacted, the bill would have taken effect July 1, 2026. It would have required an investment-policy statement by January 1, 2027, biennial public reporting by October 1 of each even-numbered year, and a comprehensive performance and risk evaluation by October 1, 2032. Because the bill did not become law, those implementation dates should be read as proposed deadlines only, not current Tennessee legal obligations.