A BILL for an Act to create and enact a new section to chapter 15-01, a new section to chapter 21-10, and a new section to chapter 54-11 of the North Dakota Century Code, relating to digital asset and precious metal investments.
HB1184 would authorize several North Dakota state investment entities to place a portion of public funds into precious metals, certain large-cap digital assets, and stablecoins. Specifically, it allows the Board of University and School Lands, the State Investment Board, and the State Treasurer to invest up to 10% of the funds they manage or invest in these asset classes. The bill also defines key terms such as digital asset, stablecoin, precious metal, qualified custodian, secure custody solution, exchange-traded product, private key, and staking.
The bill sets custody and risk-management rules for these investments. Digital assets would need to be held directly through a secure custody solution or through a qualified custodian or exchange-traded product, while precious metals would need to be held in a secure facility or through similar approved arrangements. It also permits staking and lending of digital assets, but only if the state retains legal ownership in staking and if lending is expected to improve returns without increasing financial risk. The measure would effectively expand the types of assets that state-managed funds, including the general fund, may hold under existing investment restrictions.
HB1184 would amend chapters 15-01, 21-10, and 54-11 of the North Dakota Century Code by creating new statutory authority for public investment in digital assets and precious metals. It would override existing limits in state treasury investment law to permit up to 10% allocation into these assets for the state treasurer, and similarly authorize up to 10% allocations for the university and school lands board and the state investment board. The bill would also establish new statutory definitions and custody standards that would govern how these assets are acquired, held, and managed by state officials and their custodians.
There is limited recorded discussion or voting history in the provided materials, so the overall sentiment can only be inferred from the bill’s content and its failure. The proposal appears to reflect a pro-crypto, pro-alternative-assets approach to state investing, suggesting support from sponsors interested in expanding investment flexibility and diversification. However, the bill ultimately failed, which indicates it did not secure enough legislative support to advance.
The main points of contention likely concern the prudence of exposing public funds, including the general fund, to volatile digital assets and the use of staking and lending strategies. Supporters would likely emphasize diversification, inflation hedging, and potential return enhancement, while opponents would likely question market volatility, custody/security risks, and whether state entities should hold cryptocurrencies or stablecoins at all. The 10% cap, the $500 billion market-cap threshold for eligible digital assets, and the permissibility of lending and staking are the most notable policy choices that could have drawn scrutiny.