Arizona Governor Katie Hobbs vetoed two key cryptocurrency-related bills that aimed to expand the state’s involvement in digital assets while signing a strict regulatory measure targeting Bitcoin ATMs.

On May 12, Hobbs rejected Senate Bill 1373, which sought to establish a Digital Assets Strategic Reserve Fund. The fund would have allowed Arizona to hold crypto assets obtained through seizures or legislative allocations.

“Current volatility in cryptocurrency markets does not make a prudent fit for general fund dollars,” she stated in her veto letter. “I have already signed legislation this session which allows the state to utilize cryptocurrency without placing general fund dollars at risk,” she added.

That decision followed her veto of Senate Bill 1025 — the more ambitious “Arizona Strategic Bitcoin Reserve Act” — on May 3. It would have authorized up to 10% of the state’s treasury and retirement funds to be invested in Bitcoin and other digital assets.

According to data from bitcoinlaws.io, 26 US states have introduced strategic crypto reserve bills, with 18 of them currently active.

Hobbs also vetoed Senate Bill 1024, which would have permitted state agencies to accept cryptocurrency payments for taxes, fines and fees via approved service providers.

Although the proposal attempted to shield the state from direct exposure to price volatility, Hobbs said it still introduced “too much risk.”

Related: Taiwan lawmaker calls for Bitcoin reserve at national conference

Hobbs approves Bitcoin ATM bill

On May 12, Hobbs approved House Bill 2387, which introduces new consumer protection rules for cryptocurrency kiosk (ATM) operators, aiming to reduce fraud and improve transparency.

The bill mandates that kiosks display clear, multilingual warnings about common crypto scams and require users to acknowledge these risks before completing transactions. Operators must also provide detailed receipts that include transaction data, contact information, fees and refund policies.

Furthermore, the bill caps transactions at $2,000 per day for new customers and $10,500 per day for returning users after 10 days. Kiosk providers must also offer 24/7 toll-free customer service and post the number visibly on each machine.

Under the bill, if a new user is tricked into sending crypto under false pretenses and reports it with proof within 30 days, they are entitled to a full refund, including fees.

According to CoinATMRadar, there are currently 20 active Bitcoin ATMs in Arizona.

Notably, Hobbs has not entirely closed the door on digital assets. On Wednesday, she signed House Bill 2749, which updates Arizona’s unclaimed property laws to include digital assets.

The legislation allows the state to retain unclaimed cryptocurrencies in their original form rather than liquidating them into fiat currency.

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