Two initiatives to pass a state-level Strategic Bitcoin Reserve have failed in Florida, marking another setback for the nationwide movement. Nonetheless, several other active proposals remain.
Between this failure and Arizona’s recent veto, momentum might be slowing. Utah passed a Bitcoin-centric bill after totally excising Reserve-related language, but there’s been no unambiguous victory anywhere in the US.
“Both Florida’s Bitcoin Reserve Bills have failed. The legislature adjourned its 2025 session on May 2, without passage of the bills. HB 487 and SB 550 have been ‘indefinitely postponed and withdrawn from consideration,’” claimed a crypto policy watchdog.
Technically, Florida’s Bitcoin Reserve bills accumulated bipartisan support in their first appearance. This is a critically useful tool for passing crypto-friendly regulation, but Florida’s support was fragile.
Their sponsor, Webster Barnaby, faced overwhelming skepticism at the time. Although he convinced them on the day, his words didn’t carry far.
The other might stand a better chance of receiving approval, but there’s no definite way to know. The main difference between the two involves funding.
State Reserve Race Update:
Both Florida’s Bitcoin Reserve Bills have failed.
The legislature adjourned its 2025 session on May 2, without passage of the bills.
HB 487 and SB 550 have been “indefinitely postponed and withdrawn from consideration.” pic.twitter.com/9TslaU80JW
As Florida’s Bitcoin Reserve bills quietly died in committee, it’s difficult to analyze a definite reason for their failure. Many state-level bills have been plagued by concern from fiscal conservatives unwilling to invest tax dollars in cryptocurrency.
This belief certainly has bipartisan buy-in; it’s been a feature of questions in Florida, the veto in Arizona, and other failures nationwide.
There are still a few active proposals, but their future is looking increasingly uncertain. The most hopeful prospect, in Utah, did technically become law, but only after shedding all mention of a Bitcoin Reserve.
Utah passed Bitcoin-friendly regulation, but refused this more ambitious task. If these failures continue, it may blunt momentum nationwide.
Since its launch in late March, World Liberty Financial’s stablecoin USD1 has achieved an impressive market capitalization, reflecting strong investor interest. If the creators want to maximize USD1’s reach by accessing markets abroad, particularly in Europe, they must confront MiCA’s extensive compliance list.
In a BeInCrypto interview, experts from Foresight Ventures, Kaiko, and Brickken stressed the importance of stablecoin issuers having substantial European bank reserves, operational volume caps protecting the euro, and transparent USD1 information to ensure transparency and avoid conflicts of interest.
USD1’s Search for Dollar Dominance
World Liberty Financial (WLF), a decentralized finance (DeFi) project heavily associated with the Trump family, officially launched USD1 a month ago. Through this stablecoin, WLF aims to promote dollar dominance worldwide.
So far, this initiative has been working well for WLF. According to CoinGecko, USD1 has now surpassed a market capitalization of $128 million and reached a 24-hour trading volume of nearly $41.6 million. The project has already released 100% of its total supply of 127,971,165 tokens.
USD1’s market capitalization over the past 24 hours. Source: CoinGecko.
For WLF to seriously establish dollar dominance across the globe, it will have to move fast and efficiently. This urgency stems from the need to surpass its main competitors, USDT and USDC. These rivals currently hold a massive market share advantage.
Additionally, there’s a need to maintain a competitive advantage against established currencies like the euro.
USD1 needs to access foreign markets and stand out from established competitors to achieve this. Should Europe become a primary target, USD1 must prepare to tackle numerous challenges head-on.
The EU’s Stringent Compliance Demands
The European Union (EU) became the first jurisdiction in the world to establish a comprehensive regulatory framework for digital assets across its 27 member states. This regulation, known as Markets in Crypto-Assets (MiCA), has been in effect for nearly four months. Through this legislation, the EU has confirmed how seriously it takes compliance with a defined regulatory regime.
The regulation is detailed and clear, leaving no room for interpretation. If USD1 wants to operate in this crypto market of 31 million users, it must ensure it meets every demand.
US Senators Flag Risks of Presidential Involvement in USD1
In the letter, the group asked both agencies to clarify how they plan to uphold regulatory integrity following the issuance of USD1.
The Senators cautioned that letting a president personally benefit from a digital currency overseen by federal agencies he has sway over is a big risk to the financial system. They argued that an unprecedented situation like this one could hurt people’s trust in how regulations are made.
“The launch of a stablecoin directly tied to a sitting President who stands to benefit financially from the stablecoin’s success presents unprecedented risks to our financial system,” they argued.
The letter further detailed situations where Trump could directly or indirectly affect decisions regarding USD1.
As things stand, USD1 isn’t well-prepared to follow MiCA’s strict reporting and transparency rules.
How Do Concerns Over USD1 Impact MiCA Acquisition?
According to Ianeva-Aubert, if USD1 doesn’t clear up doubts over potential conflicts of interest, this would affect its ability to apply for an operating license in the European Union.
“MiCA requires strong governance, including independent directors and clear separation between owners and managers. Issuers must have clear rules to handle conflicts of interest. If USD1 has any conflicts, this could make it harder to comply,” she said.
Ianeva-Aubert also highlighted that WLF still hasn’t released enough public information on USD1 to assess the degree of its compliance effectively. In particular, the stablecoin issuer has not disclosed the measures it would take to safeguard against market manipulation.
As of now, USD1 would likely fail MiCA’s transparency tests. However, industry experts pointed out other parts of the framework that might be even larger obstacles for USD1 to operate across the European Union.
Impact of the EU’s Reserve Mandate on USD1
When asked about the biggest regulatory hurdles USD1 would face in securing a MiCA license, experts’ responses were unanimous. The stablecoin would need to store a large portion of its reserves in a European bank.
This mandate has proven difficult for established stablecoin issuers seeking operations across the region.
This regulation aims to ensure seamless accessibility for European crypto users and traders. For Forest Bai, Co-founder of Foresight Ventures, USD1 could capitalize on this opportunity during the early stages of its development. By doing so, it could avoid some of the obstacles its competitors had to endure.
Yet, even as USD1 scales and its demand grows, other mandatory requirements could restrict its scope of success.
MiCA’s Transaction Volume Caps to Preserve Euro Dominance
As part of the MiCA regulation, the European Union has taken specific measures to safeguard the euro’s dominance. If a digital currency not denominated in euros were to become extensively adopted for daily payments within Europe, it could present a potential risk to the European Union’s financial sovereignty and the stability of the euro.
To contain this possibility, MiCA places volume caps on transactions used as a means of exchange within the EU.
In other words, MiCA establishes predefined limits on the transactional volume of such currencies. The EU initiates regulatory measures when these limits are exceeded due to widespread payment usage.
Specifically, USD1 issuers must suspend any further digital currency issuance and provide a remediation plan to the relevant regulator, outlining steps to ensure their usage does not negatively impact the euro.
If USD1 wants to work in places where it can experience uninhibited growth, the European market might not be the best fit for this stablecoin. Other parts of MiCA also suggest this could be the case.
MiCA Limitations to Stablecoins as Investment Vehicles
EU regulators have been clear that stablecoins, or e-money tokens (EMTs), as the regulation refers to them, are payment instruments that should not be confused with investment vehicles. The MiCA framework has a few rules in place to prevent this.
Given the circumstances, experts like Bai think WLF might want to focus on countries with better market conditions for stablecoin issuers.
Should WLF Consider the EU Market for USD1 Operations?
While the European Union has an undeniable crypto market presence, other jurisdictions have an even larger footprint.
”The EU’s crypto market remains comparatively small, with just 31 million users versus Asia’s 263 million and North America’s 38 million users, according to a report from Euronews. This limited market size may not justify MiCA compliance costs for projects, like WLFI,” Bai told BeInCrypto, adding that “Projects ultimately determine their own growth strategy. Given that, currently, the EU represents a secondary market for USD1, the project’s strategic priorities may naturally shift toward regions with less stringent stablecoin regulations to drive its adoption.”
These circumstances alone may prompt USD1 to reconsider its options.
In fact, USD1 could start by gaining a competitive edge right at home.
USD1’s Political Backing at Home
With a crypto-friendly president in office –whose very crypto project officially announced the launch of USD1– the stablecoin has sufficient backing to make its mark.
Looking past the immediate future, Bai underlined that if the US doesn’t keep developing supportive crypto regulations, USD1’s growth in the country could be held back following a government shift.
Given this reality, USD1’s failure to comply with the EU’s regulations, should it ever even consider applying for a MiCA license in the first place, could have negative consequences for the project’s long-term viability.
Regardless of the markets WLF evaluates in its efforts to increase the reach of USD1, compliance with general stipulations concerning transparency, legal architecture, and real-time transaction oversight could be conducive to its eventual success.
Bitcoin’s decisive break above the psychological $95,000 barrier has reignited bullish momentum across the crypto market. As market sentiment becomes increasingly positive, crypto whales are buying several differentiating altcoins this week.
Among the top picks are Avalanche (AVAX), Ethereum (ETH), and meme-coin Pepe (PEPE), all of which have seen significant whale inflows this week.
Avalanche (AVAX)
Layer-1 (L1) coin AVAX has seen increased whale attention this week, reflected by the spike in its large holders’ netflow. According to IntoTheBlock, this has rocketed over 380% in the past seven days.
A large holder is a wallet address holding over 0.1% of an asset’s circulating supply. The large holders’ netflow tracks these investors’ buying and selling activity.
When it rises, crypto whales buy more tokens. This bullish signal often prompts retail investors to increase their holdings.
If AVAX’s accumulation trend persists, its price could breach the resistance at $24.28 and rally toward $30.23.
Conversely, if demand wanes, AVAX could fall to $14.66.
Ethereum (ETH)
Amid the recent broader market rally, ETH has recorded a modest 3% price uptick in the past seven days, buoyed by steady whale accumulation.
According to Santiment, during that period, whale addresses holding between 10,000 and 100,000 coins have acquired 280,000 ETH valued at over $510 million at current market prices.
As of this writing, this cohort of ETH whales controls 25.24 million ETH, their highest holding in the past month. ETH’s price could be driven above the psychological $2,000 mark if whale accumulation persists.
However, if the bears regain dominance, they could push the coin’s price to $1,733.
Pepe (PEPE)
Popular meme coin PEPE is another asset that has seen a surge in crypto whale accumulation this week. Per Santiment, wallet addresses that hold between 100,000 and 1 million tokens have bought 350 million PEPE in the past seven days.
At press time, the meme coin trades at $0.0000086. If whale accumulation persists, PEPE could reverse its current downtrend and break above the resistance at $0.0000010.
State Reserve Race Update:
