Texas Invests $5M in Bitcoin ETF Shares, Plans Additional $5M in Self-Custody BTC

Texas is taking bold steps in the cryptocurrency space by purchasing $5 million of Bitcoin through BlackRock’s spot ETF and is gearing up for another $5 million investment to be held securely within the state.

Key Takeaways:

Texas has invested $5M in BlackRock’s Bitcoin ETF and intends to invest an additional $5M in self-custody Bitcoin.
The state has set aside a total of $10M for Bitcoin investments, with plans to transition from ETF exposure to self-custody once the necessary systems are in place.
This initiative reflects changing attitudes toward Bitcoin among governments, with other states like Wisconsin also pursuing investments in Bitcoin.

The initial purchase was revealed by Lee Bratcher, the president of the Texas Blockchain Council, this week. He explained that the first investment was made via BlackRock’s iShares Bitcoin Trust (IBIT) while the state seeks to establish its long-term custody solutions.

Texas Invests $5M in Bitcoin ETF Shares, Plans Additional $5M in Self-Custody BTC

Texas Plans Additional $5M Bitcoin Purchase After Initial ETF Acquisition

Bratcher indicated that Texas has a total allocation of $10 million, but so far, only $5 million has been invested. The remaining funds are expected to be directed into direct Bitcoin purchases once the state’s custody systems are finalized.

“Texas will self-custody Bitcoin,” Bratcher stated, highlighting that the ETF acquisition is merely a temporary measure.

The initiative sparked strong reactions from figures in the cryptocurrency industry. Pierre Rochard, CEO of The Bitcoin Bond Company, remarked that Texas’ recent actions demonstrate a significant shift in government sentiment towards cryptocurrencies.

“In just five years, we’ve moved from the belief that governments would ban Bitcoin to them now starting to accumulate it in small amounts. Hyperbitcoinization is happening,” he asserted.

It remains uncertain whether this investment is directly tied to Texas’ strategy for a strategic Bitcoin reserve. In June, Governor Gregg Abbott approved legislation permitting the state to hold Bitcoin as part of its long-term financial assets. This legislation enforces a restriction that limits holdings to assets with a market cap over $500 billion, a threshold that Bitcoin surpasses easily. However, BlackRock’s ETF does not meet this criterion, indicating that this purchase is a temporary arrangement rather than a shift in official reserve strategy.

Texas isn’t the first state to gain exposure through BlackRock’s IBIT. Wisconsin’s investment board had previously acquired nearly $100 million in IBIT shares in May 2024, according to filings.

Harvard’s Major Investment in Bitcoin ETF

In a separate but notable development, Harvard University’s endowment fund recently announced a $443 million allocation to BlackRock’s IBIT, which makes up about 20% of its U.S. equity exposure. This significant move represents one of the most prominent institutional endorsements of Bitcoin among prestigious university endowments, placing Harvard as the 16th-largest shareholder of the BlackRock-managed fund.

Harvard’s recent 13F filing indicated an increase in its holdings from 1.9 million shares in June, while simultaneously increasing its gold ETF investments by 99%, totaling 661,391 shares valued at $235 million.

Additionally, Al Warda Investments, a division of the Abu Dhabi Investment Council (ADIC), has also expanded its Bitcoin exposure, more than tripling its investment in BlackRock’s IBIT during the third quarter, now holding just below 8 million shares valued at approximately $517.6 million.

ADIC is known for its cautious public investments in listed digital assets, typically choosing private market strategies involving buyouts, infrastructure, and real estate.