MONTGOMERY, Ala. — Alabama State Auditor Andrew Sorrell has proposed a novel and controversial idea: the creation of a state-held bitcoin reserve. Critics call it impractical, dangerous, and emblematic of political posturing rather than sound financial stewardship.
Sorrell’s pitch hinges on bitcoin’s potential as a hedge against inflation, a concern often raised by Republicans wary of federal monetary policies. The idea, however, has raised eyebrows among economists and political observers, who note that bitcoin’s volatility makes it a poor choice for safeguarding public funds.
Bitcoin’s history has been marked by dramatic price swings, with values skyrocketing to nearly $69,000 in 2021 before plummeting to below $20,000 the following year. While the cryptocurrency has regained some ground, its unpredictable nature underscores why it is viewed as speculative, not stable—a key quality for state financial reserves.
Alabama’s finances are already precarious, with persistent underfunding in critical areas like education and healthcare. Critics argue the state can ill afford to gamble with taxpayer money on an asset that can lose half its value in a matter of weeks. Proponents of public finance stability point to established hedges, like Treasury bonds or gold, as far more reliable.
Sorrell’s proposal fits into a broader pattern of right-wing interest in cryptocurrency, which some conservatives champion as an alternative to centralized banking and fiat currency. But the practicality of incorporating bitcoin into state reserves remains deeply questionable. Observers have noted that such ideas often appeal more to a donor base enamored with crypto than to fiscal prudence.
To many, the proposal feels more symbolic than substantive—a way to signal alignment with libertarian ideals rather than a genuine solution to Alabama’s economic challenges. Skeptics worry that proposals like Sorrell’s not only fail to address real problems but could also distract from urgently needed investments in public infrastructure and social services.
Whether Sorrell’s bitcoin reserve idea gains traction in the legislature remains to be seen. For now, it stands as a striking example of how Alabama’s political landscape is navigating the tension between fiscal responsibility and ideological experimentation.