The proposed bill, known as the "Rhode Island Digital Asset Retention Act," establishes a framework for the state treasurer to invest in Bitcoin and other digital assets. It authorizes the state treasurer to invest unexpended, unencumbered, or uncommitted funds from specific state funds, including the general fund, the budget stabilization reserve fund, and any other investment fund managed directly by the state treasurer, with a limit of 10% of the total amount in those funds during a calendar year.

The bill includes a comprehensive definition section that clarifies terms related to digital assets, such as "Bitcoin," "digital asset," "exchange-traded product," "private key," "qualified custodian," and "secure custody solution." It mandates that any Bitcoin or digital assets acquired must be held directly by the state treasurer through a secure custody solution provided by a qualified custodian or in the form of an exchange-traded product issued by an investment company registered in Rhode Island. Additionally, the state treasurer is permitted to loan Bitcoin or digital assets to generate additional returns, provided it does not increase the financial risk to the state.

The act also allows state retirement systems to invest in exchange-traded products with money deposited in state retirement funds that are unexpended, unencumbered, or uncommitted. The act is set to take effect on September 1, 2025.