Yesterday, the representative Jordan Pace reintroduced Bill H. 4256, the “Strategic Digital Assents Reserve Act of the South Carolina”, in the Chamber of Representatives of the South Carolina.
The salient points of the bill include the fact that it allows the state treasurer to invest up to 10% of the funds in the state management in digital activities, including bitcoin and that the strategic reserve of state digital activities can include up to one million bitcoin.
The bill also states that the reason to establish such a reserve is because “inflation has eroded the purchasing power of the activities held in state funds” and that “Bitcoin, a decentralized digital activity and other digital activities offer unique properties that can act as a coverage against inflation and economic volatility”.
The bill does not establish whether state officials must keep the private keys of Bitcoin and other digital activities that accumulates for the reserve, although it allows the state treasurer to develop policies and protocols to protect the activities held in the reserve, including the use of the cold or the contract of a third party to maintain the custody of the activities. The state treasurer can also use a third party to help in creating, maintenance and administration of the safety of the reserve.
According to the account, the state treasurer would be responsible for the preparation of a two -year relationship that includes the total amount of digital activities held in the reserve, the value of the US dollar of these activities and the transactions and expenses relating to the reserve from the previous report. In addition, the state treasurer would be required to publish tests of the reserves, which includes public addresses of digital activities held in the reserve on an official state website, allowing citizens to control independently and verify the participations of the reserve.
Finally, the bill establishes that the strategic digital resources reserve undergoes audit that include an examination of the quality of safety of custody solutions; an assessment of compliance with local, state and federal laws; It is an assessment of internal controls to mitigate IT attacks and bad management.
According to the bill, independent audits should be conducted every year and presented to the relevant supervision committee. Any recommendations resulting from independent audits must be addressed within 90 days of the issue of the report and a follow-up report that describes in detail the corrective actions taken must also be provided to the surveillance committee.