The proposed bill, known as the "Rhode Island Digital Asset Retention Act," establishes a framework for the state treasurer and state retirement systems to invest in Bitcoin and other digital assets. The act 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 outlines conditions for holding these digital assets, requiring that they be secured 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 for the state, provided that such loans do not increase financial risk.

Furthermore, the act allows state retirement systems to invest in exchange-traded products related to digital assets, ensuring that these investments are made with uncommitted funds. The legislation includes detailed definitions of key terms such as "Bitcoin," "digital asset," and "qualified custodian," and specifies the criteria for secure custody solutions. The act is set to take effect on September 1, 2025.