Michigan lawmakers introduced four cryptocurrency bills on May 21, 2025, according to BTC Peers. The legislative package addresses state pension fund cryptocurrency investments, central bank digital currency restrictions, Bitcoin mining at abandoned oil and gas wells, and related tax policies.

State Pension Fund Cryptocurrency Investment Framework

House Bill 4510, introduced by Representative Bill Schuette, permits Michigan's state treasurer to invest retirement funds in cryptocurrencies. The bill restricts investments to digital assets averaging at least $250 billion market capitalization over the previous year. Currently, only Bitcoin and Ethereum qualify for these investment thresholds.

Pensions & Investments reports that 23 states introduced similar legislation in 2025 to allow public cryptocurrency investments. The Michigan proposal follows the state's existing cryptocurrency exposure through its retirement system.

Michigan already holds cryptocurrency investments through exchange-traded funds. Decrypt reported that the State of Michigan Retirement System purchased $6.6 million in Bitcoin ETF shares in 2024 and added $10 million in Ethereum ETF holdings by November 2024.

The state manages $143.9 billion in pension fund assets for state employees. Michigan faces $29.9 billion in unfunded pension liabilities for teachers, creating pressure to pursue alternative investment strategies that could generate higher returns.

Environmental Mining Initiative and Tax Incentives

Representative Mike McFall's House Bill 4512 establishes a "Bitcoin Program" allowing private companies to mine cryptocurrency at abandoned oil and gas wells. Axios explains that operators would plug wells in exchange for temporary mining rights using residual fuel sources.

The Environmental Defense Fund mapped 81,000 orphaned wells across the United States. Federal funding exists for well remediation, but resources remain insufficient. Bitcoin mining could provide additional financing for environmental cleanup projects.

House Bill 4513 provides tax deductions for revenue earned through the mining program. DeSmog notes that similar legislation has been introduced in Oklahoma, Mississippi, and Texas, linking cryptocurrency operations to environmental remediation efforts.

The Satoshi Action Fund drafted model legislation for states to streamline Bitcoin mining partnerships with abandoned well cleanup. However, Capital & Main reports that environmental groups caution these programs could extend fossil fuel dependency by creating new demand for oil and gas resources.

CBDC Opposition and Federal Alignment

House Bill 4511, sponsored by Representative Bryan Posthumus, prohibits state agencies from supporting central bank digital currencies. The bill bans licensing, taxation, or restrictions on digital asset holdings while preventing Michigan departments from advocating for a U.S. CBDC.

Reuters reports that President Trump banned federal CBDC development through executive order in January 2025. Michigan joins growing state-level opposition to digital dollar initiatives.

The Atlantic Council notes that 134 countries representing 98% of global GDP are exploring CBDCs. Trump's ban makes the United States the only country to impose a presidential prohibition on such digital assets, potentially allowing China and Europe to advance their CBDC programs without U.S. competition.

The House passed the CBDC Anti-Surveillance State Act in May 2024, though the Senate has not acted. ABA Banking Journal reports that the American Bankers Association supported the legislation, saying CBDCs present unacceptable risks to the financial system.

Market Context and Interstate Competition

Michigan's bills reflect accelerating state-level cryptocurrency adoption. New Hampshire became the first state to approve crypto reserves on May 6, 2025, allowing 5% of public funds for cryptocurrencies exceeding $500 billion market capitalization.

Texas passed similar legislation on May 20, 2025, though The Dallas News indicates the state allocated no specific funding amount. Twenty-seven states introduced Bitcoin reserve proposals in 2025.

Bitcoin currently trades above $90,000, according to current market data, with institutional price predictions ranging from $122,000 to $250,000 for 2025. CNBC reports that Standard Chartered expects Bitcoin to reach $200,000 by year-end, driven by continued institutional flows and regulatory clarity.

State treasurers seek portfolio diversification amid inflation concerns. Bitcoin's performance attracted institutional attention, with pension funds across multiple states beginning cryptocurrency allocations through regulated exchange-traded products.

The legislative package awaits committee reviews and floor votes. Michigan joins a competitive state landscape where cryptocurrency policies increasingly influence economic development strategies, as states recognize digital assets' growing role in modern finance.

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