Florida State Chief Financial Officer Jimmy Patronis made the announcement required That state pension fund managers are exploring the feasibility of investing in Bitcoin, puts the state in a position to adopt Bitcoin as a strategic reserve asset. In a letter dated October 29, 2024, addressed to Chris Spencer, executive director of the Florida SBA, Patronis outlined his vision for integrating Bitcoin into the state’s investment portfolio.
Patronis’ proposal comes on the heels of former President Donald Trump’s recent speech at the 2024 Bitcoin Conference, where Trump called on the United States to create a national stockpile of Bitcoin. “This comes at a time when the Chinese Communist Party is invading the world of cryptocurrencies every day to take control of this emerging currency,” Patronis points out, referring to the geopolitical motivations for embracing Bitcoin.
It also highlights Trump’s wise leadership. Trump said he would create a Presidential Cryptocurrency Advisory Council and create a national “stockpile” of Bitcoin using the cryptocurrency currently held by the US government, most of which has been seized in law enforcement actions. I believe that such thoughtful and innovative thinking from a successful businessman like President Trump should not be taken for granted.
Will Florida embrace Bitcoin as a strategic reserve asset?
Florida’s strong economic position — with a AAA bond rating for the fifth straight year and record reserves — makes it well-positioned to pioneer innovative investment strategies, Florida’s CFO stresses. “If Florida were a sovereign country, it would be the 16th largest economy in the world,” Patronis says.
Patronis also points to actions taken by other countries as precedents. “Two other states, Wisconsin and Michigan, have deemed it prudent to invest a small portion of their retirement funds in cryptocurrencies,” he wrote. Additionally, he pointed to Arizona’s legislative efforts to include Bitcoin in state pension funds and highlighted Wyoming and Nebraska as leaders in Bitcoin mining and legislative frameworks designed to attract the industry, including provisions for chartering cryptocurrency banks.
Governor Ron DeSantis’ recent legislation to combat central bank digital currencies (CBDCs) is being cited as a safeguard for Floridians’ personal finances against “government overreach and awakening corporate surveillance.” Patronis has linked this position to the decentralized nature of Bitcoin, noting that “on its face,[Bitcoin]is the antithesis of centralized currency, providing decentralized digital currencies managed on blockchain technology, and not issued or controlled by any government agency.”
The core of Patronis’ argument revolves around the potential financial benefits for Florida’s public servants. “When managing state pensions for firefighters, teachers and police officers, it is also essential to prioritize the bottom line and ensure the best return on investment for Floridians,” he stresses.
He suggests that bitcoin, often referred to as “digital gold,” could “help diversify a country’s portfolio and provide a safe hedge against the volatility of other major asset classes.” He adds: “The state board maintains a Florida Growth Fund that allows for more innovative and emerging investments, and a cryptocurrency investment pilot program could be a great fit, offering potential benefits that we cannot ignore.”
In his letter, Patronis requests a comprehensive report from the Small Business Administration (SBA) on “the feasibility, risks, and potential benefits of directing a portion of state retirement system funds into digital asset classes.” He emphasizes the importance of this analysis in informing legislators before the next legislative session. He concludes, “There is no telling what the future of (Bitcoin) will be, but it is important that Florida stays ahead of the curve when considering new investments and providing the best returns for Floridians.”
At press time, Bitcoin was trading at $72,467.
Featured image created with DALL.E, a chart from TradingView.com
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