Kansas Bill Proposes Bitcoin Reserve From Unclaimed Assets

• Bill Number: Kansas Senate Bill 352
• Proposed Asset Source: Forfeited and unclaimed digital assets, not direct state purchases.
• Allocation Mandate: 10% of each forfeited asset deposit is transferred to the state’s general fund, while the principal Bitcoin amount is held in the reserve.
• Legislative Status: Referred to the Senate Committee on Financial Institutions and Insurance for further review.

By targeting unclaimed property, Kansas is attempting to solve two problems at once: establishing a long-term digital asset holding and creating a clear legal framework for managing abandoned crypto. State treasurers across the country are increasingly dealing with assets from dormant exchange accounts, and according to the National Conference of State Legislatures, many existing statutes are ill-equipped to handle them. SB 352 addresses this by formally defining terms like “digital assets” and “airdrops” within its unclaimed property laws.

This model allows the state to build a position in Bitcoin passively. The 10% liquidation for the general fund provides an immediate, albeit small, revenue stream, while the bulk of the assets are retained for potential long-term appreciation. It’s a low-risk, long-term play that builds a foundation for more sophisticated digital asset strategies in the future, reflecting a growing trend of US states exploring blockchain technology and asset ownership through cautious, incremental legislation.

While innovative, this approach is unlikely to create a reserve of significant scale in the short term. The volume of unclaimed Bitcoin and other digital assets in Kansas is an unknown variable, and it will almost certainly be dwarfed by the direct sovereign purchases made by countries like El Salvador. Furthermore, the state faces substantial technical and security hurdles. Establishing secure, institutional-grade custody for a diverse range of digital assets is a complex and expensive undertaking that exposes the state to new vectors of risk, from hacks to simple operational errors.

The immediate focus is on SB 352’s journey through the Senate Committee on Financial Institutions and Insurance. Testimony from the Kansas State Treasurer’s office regarding the operational feasibility of custody and management will be critical. This proposal follows a January 2025 bill that would have allowed the state’s pension system to invest in digital assets, indicating sustained legislative interest. We should also monitor if other states, guided by frameworks like the Revised Uniform Unclaimed Property Act, begin to adopt similar models for handling the growing pool of abandoned digital assets.

• Kansas SB 352 offers a low-risk blueprint for state-level Bitcoin adoption using unclaimed assets.
• The legislation creates needed legal clarity for defining and managing abandoned digital property.
• The model provides a small, immediate revenue stream (10% liquidation) while retaining the core asset for long-term growth.
• The scale of the reserve will be limited by the amount of unclaimed crypto, and the state must overcome significant custody challenges.
• This bill signals a broader trend of states cautiously integrating digital assets into their financial and legal systems.