On November 20, 2025, the State of Texas purchased $5 million worth of shares in BlackRock’s iShares Bitcoin Trust (IBIT), cementing its status as the first U.S. state to make a Bitcoin acquisition for a strategic reserve. This transaction, which acquired Bitcoin at a price of roughly $87,000, represents the initial deployment of a $10 million allocation authorized by state lawmakers.
A Strategic First Step into Bitcoin
The purchase was made possible by Senate Bill 21, signed into law by Governor Greg Abbott in June 2025, which established the Texas Strategic Bitcoin Reserve. According to Lee Bratcher, President of the Texas Blockchain Council, using the BlackRock ETF is a temporary measure. “Texas will self-custody Bitcoin”, Bratcher stated, explaining that the ETF provides immediate exposure while the state finalizes its own secure framework for holding the digital asset directly.
Strategic Investment and Institutional Context
The purchase was authorized through House Bill 1234 and Senate Bill 21 with the backing of Governor Greg Abbott and public support from Lee Bratcher, president of the Texas Blockchain Council. The temporary use of an ETF serves as an operational solution to bypass immediate legal and implementation requirements while the state develops internal controls for direct Bitcoin ownership.
BlackRock’s IBIT is one of the largest Bitcoin ETFs in the market, reportedly managing assets approaching $100 billion and holding more than 625,000 BTC—equivalent to approximately 3.658% of Bitcoin’s total supply. The fund generates an estimated annual operating profit of $244.5 million, though it has experienced significant volatility, including a record single-day withdrawal of $523 million.
Texas joins a growing list of institutional investors entering the Bitcoin market, following notable moves by:
- Wisconsin Investment Board’s $100 million purchase in May 2024
- Increased exposure from academic entities and sovereign funds
This institutional shift prompted Pierre Rochard, CEO of The Bitcoin Bond Company, to observe: “In five years we went from ‘governments will ban bitcoin’ to ‘governments only buy a small amount of bitcoin'”—highlighting the transformation in institutional perception of the asset.
Planned Transition to Self-Custody
Texas plans to transition from the regulated ETF structure to direct state self-custody of Bitcoin, which will require implementing robust management systems before transferring assets. This self-custody approach—where the state directly controls private keys—necessitates specialized access controls, compliance mechanisms, and governance frameworks to mitigate operational and legal risks.
While the operation doesn’t alter Bitcoin’s peer-to-peer network topology or consensus parameters, it introduces new requirements for custody chain resilience and process auditing that must be verified by security teams and auditors.
The remaining $5 million allocation will be executed once the state completes its operational and compliance framework for direct Bitcoin custody, marking the next verifiable milestone in Texas’s Bitcoin investment strategy.