•The North Carolina House of Representatives has passed a bill that includes provisions to investigate the acquisition and potential benefits of Bitcoin and other cryptocurrencies.
•The bill is commissioning a $50,000 study for analyzing the expected benefits of deploying a chunk of the General Fund to digital assets.
•It would also research if such a holding by the state would help in slashing overall portfolio volatility and increasing portfolio returns over time.
North Carolina House Studies Benefits of Holding Bitcoin
The North Carolina House of Representatives recently passed a bill titled “State Precious Metals Depository Study” which aims to examine the potential impact of securely holding, insuring, and liquidating virtual currency, with special emphasis on Bitcoin. The legislation received 73 votes in favor, 40 against, while seven participants were absent. It has now been referred to the Senate for further consideration.
$50K Study Commissioned
A $50,000 study has been commissioned to analyze the expected benefits of deploying a chunk of the General Fund into digital assets as well as hedging against inflation and systemic credit risks. Moreover, costs, benefits and security measures related to different depository options will be assessed. Its feasibility will also be examined when it comes to leveraging a privately managed depository or another state’s depository or setting up a State-administered depository.
Potential Benefits Of Holding Bitcoin
The bill intends to explore potential benefits from holding digital currencies such as Bitcoin including potentially reducing portfolio volatility and increasing portfolio returns over time. Additionally, it is hoped that such an investment may serve as an effective hedge against inflation by protecting holders from drastic market declines in traditional markets like stocks or bonds due to economic downturns or geopolitical instability.
Security Measures To Be Examined
Given that cryptocurrency transactions take place directly between two parties without intermediaries or third-party oversight involved, security measures need to be examined closely when it comes to investing in them at any scale including at the state level where large sums are involved. Therefore security protocols must be established before any funds are allocated by North Carolina into this asset class in order for any investments made by them not only remain secure but also compliant with all applicable regulations regarding safekeeping funds entrusted by public entities.
This proposed initiative looks into assessing whether investing in cryptocurrency could bring about positive results within North Carolina’s financial portfolios while identifying possible risks associated with this asset class that need addressing beforehand for ensuring investor safety on part of all stakeholders involved if such an investment plan gets approved by lawmakers eventually after thorough examination from both legislative bodies and regulatory agencies alike .