Virginia Senate KILLS Cryptocurrency Reserve Bill Despite Online Hype

Virginia committee shelves SB 557 strategic bitcoin reserve proposal

The official vote tally lists the action as “Passed by indefinitely in General Laws and Technology (13-Y 2-N),” according to Virginia’s Legislative Information System vote record.

In its introduced form, SB 557 would have allowed purchases of bitcoin or other cryptocurrency meeting an average market-cap threshold of at least $500 billion over the most recent 24 months, the bill text showed. The proposal also created an advisory committee that included three members “with expertise in cryptocurrency investments,” and it authorized contracts with third parties such as a qualified custodian using secure custody technologies, including cold storage.

The introduced text also required the State Treasurer to publish and submit a biennial report by Dec. 31 of each even-numbered year disclosing holdings, estimated value, and changes in the fund over the prior fiscal biennium. It did not specify an immediate allocation amount, meaning any actual buying would still depend on implementation choices and funding.

The committee vote means the measure will not reach the full Senate floor unless it is revived and re-referred, a high bar once a bill is effectively disposed of in committee. The setback also lands amid a broader patchwork of U.S. policy catalysts, including the delayed market-structure calendar we detailed in US Senate Voting On CLARITY Act Has Been Canceled.

Why headlines got it wrong

In Virginia’s process, a committee motion to “pass by indefinitely” is used to dispose of a bill for the session; the Virginia General Assembly’s legislative glossary describes it as killing a measure unless it is later reconsidered.

Crypto headlines treated the 13–2 tally as a win, with Bitcoin Magazine describing SB 557 as a bill that advanced in committee. But the vote itself was on the motion to pass by indefinitely, meaning “yes” votes supported stopping the bill, not advancing it.

For investors, the immediate market impact of a state committee vote is usually indirect, but policy headlines can add to volatility and sentiment swings. One way long-term accumulators reduce the pressure to trade every headline is a rules-based plan like dollar-cost averaging, which we break down in our guide to DCA in crypto.

Strategic bitcoin reserve bills are spreading, but politics are still a gate

SB 557 is part of a growing wave of state-level “bitcoin reserve” proposals arguing that scarce digital assets could play a role in long-horizon public portfolios. But the Virginia bill’s eligibility screen, an average market cap of at least $500 billion over 24 months, sets a bar that few assets can meet, narrowing the debate to custody, governance, and disclosure rather than a broad “crypto basket.”

Supporters of state reserve proposals typically frame them as an inflation-hedge play and a way to codify custody standards if governments hold digital assets. Critics focus on volatility, operational risk, and the question of whether taxpayers should be exposed to assets that can move double digits in a single session.

The episode also illustrates how crypto legislation can move in fits and starts: even as some lawmakers pitch reserve funds, other fights, including whether stablecoins can pass yield to holders, are slowing broader U.S. legislation, as we covered in Crypto Bill Is Stalling as Banks Dig In on Stablecoin Yields.

For a bigger map of how the SEC, CFTC, banking regulators, and Congress intersect on market structure and stablecoins, see US Crypto Regulation 2026: SEC, CFTC, Stablecoins, Taxes.

What’s still unknown is whether Reeves or allies will attempt to revive SB 557 this session or refile it with different guardrails next year; the committee vote record does not provide a rationale beyond the motion. For now, the next catalysts are procedural: watch Virginia committee calendars for reconsideration attempts, and track which states keep similar reserve proposals alive as market conditions and politics shift.