Texas kept its $10 million Bitcoin ETF position unchanged in Q2, even as the market value dropped to $6.6 million. The state's approach highlights the risks and complexities of public crypto treasury management.
Texas has chosen to maintain its $10 million allocation to BlackRock's iShares Bitcoin Trust (IBIT) through the second quarter of 2026, despite a significant decline in the value of its holdings. According to filings with the U.S. Securities and Exchange Commission, the Texas Treasury Safekeeping Trust Company (TTSTC) reported no change in its 197,844-share position in IBIT between March 31 and June 30, even as Bitcoin's price continued to slide.
Unchanged Position Amid Market Decline
TTSTC, which manages the Texas Strategic Bitcoin Reserve and oversees approximately $165 billion in state assets, initially allocated $10 million to IBIT as a temporary measure while preparing for direct Bitcoin custody. As of June 30, the market value of the state's IBIT shares had fallen to about $6.62 million, down from roughly $7.6 million at the end of the first quarter. BlackRock reported IBIT's net asset value at $33.48 per share on June 30, a 13.31% drop from $38.62 at the end of March, closely tracking Bitcoin's 13.25% decline over the same period.
Discrepancies in Reported Values
Despite the market drop, TTSTC's regulatory filings listed both the share count and the stated value of the IBIT position as unchanged for the quarter. The filings continued to show the original $7.602 million value, which reflected the position's worth at the end of Q1, not the lower Q2 market value. This reporting gap leaves open questions about how the state values its crypto holdings for official purposes and whether the full $10 million allocation is entirely represented by the IBIT shares.
Strategic Approach and Broader Context
Texas has stated that its use of IBIT is an interim step while it builds infrastructure for direct Bitcoin custody. The state's decision to hold through the downturn contrasts with other entities that have liquidated digital assets to manage risk or fund operations. For example, Riot Platforms recently sold Bitcoin reserves to finance a $9.1 billion AI data center lease, as detailed in EgonCoin's coverage of Riot's treasury strategy. Texas's approach highlights the complexities of managing public crypto reserves, especially when market volatility can quickly erode paper gains.
At the end of Q2, the state's IBIT position was worth about $3.38 million less than the original $10 million allocation, assuming the entire reserve is held in the ETF. Texas has not disclosed whether it plans to rebalance or adjust its exposure as it transitions to direct custody, nor has it clarified how it will address the reporting discrepancies in future filings.
According to BlackRock's official filings, IBIT's net asset value fell from $38.62 per share on March 31, 2026, to $33.48 per share on June 30, 2026. Over the same period, Bitcoin's price dropped from $68,129.64 to $59,101.49, reflecting a 13.25% decline. TTSTC's 197,844 IBIT shares represented a market value of approximately $6.62 million at quarter-end, compared to the $7.602 million reported in state filings.
Public sector crypto investments like Texas's Bitcoin reserve face unique challenges compared to private funds. Unlike private investors, state entities must navigate regulatory reporting, public accountability, and operational hurdles when managing digital assets. The use of ETFs as a stopgap solution can introduce additional complexity, especially when market values diverge from reported figures. As more states and municipalities explore crypto treasury strategies, the Texas experience underscores the importance of transparent reporting, risk management, and clear custody arrangements to protect public funds in volatile markets.
