State Treasurer Brad Briner would be able to invest as much as five percent of North Carolina’s state retirement funds in digital assets like cryptocurrencies under a bill the N.C. House of Representatives approved Wednesday.
House Bill 92 allows the state treasurer to invest as much as five percent of any one of the state’s retirement funds in digital assets like cryptocurrencies, nonfungible tokens or stablecoins.
“What this does is allow the state treasurer to do his job. It doesn’t direct him to invest in anything, but it simply opens up one more asset class that the state can take advantage of to ensure the long-term fiscal health,” said Mike Schietzelt, a Wake County Republican. Schietzelt is the bill’s primary sponsor.
Some Democrats argued on the House floor that crypto is a risky investment strategy and could leave state employees’ retirement funds vulnerable to theft.
An earlier version of House Bill 92 capped investment in crypto at 10% of the total funds. The version on the House floor Wednesday slashed that in half.
Rep. Tracy Clark, a Greensboro Democrat, argued that investing in crypto would effectively represent gambling with state employees’ retirement funds. Under the legislation, Clark said, the state treasurer could purchase a non-fungible token with as much as $6.35 of the state’s retirement funds.
“If you want to invest your own hard-earned $13,000 legislator salary in crypto, go for it, but do not do it with North Carolina taxpayer dollars. Remember your role as a fiduciary to your constituents,” Clark said.
During Wednesday’s debate, Rep. Marcia Morey, a Democrat from Durham, held up a printed out photo of the Bored Ape NFT that Justin Bieber bought with coins valued at about $1.3 million. That asset quickly lost about 95% of its value, a point Morey used to demonstrate the risk of investing in digital assets.
“I would trust a sophisticated investor, a sophisticated person, like Treasurer Briner not to invest in this and, in fact, to establish procedures, rules, policies for future treasurers to follow with regard to this. And I don’t know that there’s anybody I trust more to set those policies,” Schietzelt said.
Rep. Curtis Loftin, a Charlotte Democrat, warned Republican lawmakers that their trust in Briner shouldn’t be the reason for such a change in the state’s investment strategy.
“When we make laws, we don’t make it based on who happens to occupy an office at a particular time or who happens to be the Treasurer at this moment. We’re making laws that are supposed to apply regardless of who is in the office,” Loftin said.
Other changes for the Treasurer
Under the legislation approved Wednesday, Briner or subsequent treasurers could also explore the possibility of letting state employees invest supplemental retirement funds in digital assets.
It also directs Briner to work with the N.C. State Bureau of Investigation and other law enforcement agencies to explore a reserve to hold digital…
Read More: House passes bill that would give NC Treasurer the option to invest some
