A Texas legislator has filed two bills to establish a state-sanctioned currency backed by precious metals, marking a significant monetary policy initiative in the Lone Star State.
House Bills 1049 and 1056, introduced by State Representative Mark Dorazio on November 12, would authorize the Texas Comptroller to issue physical coins and electronic currency, fully backed by gold and silver held in the Texas Bullion Depository.
Under the proposed legislation, residents could conduct transactions using gold and silver-backed currency that would be “electronically transferable to another person” and “redeemable in specie or at the spot price of gold in U.S. dollars minus applicable fees,” according to the Tenth Amendment Center’s analysis.
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“The passage of this legislation would create a sound money alternative to U.S. dollars in both physical and electronic form,” said Mike Maharrey, Communications Director at the Tenth Amendment Center. He noted that users could conduct business “using a debit card that seamlessly converts gold and silver to fiat currency in the background.”
The initiative parallels a separate blockchain proposal championed by Representative Cody Harris, who views state-issued gold-backed digital tokens as a pathway to wider cryptocurrency adoption.
“This is something safe that people can get their feet wet with,” Harris said at the North American Blockchain Summit. “It’s more of a stepping stone to owning Bitcoin than competing with it.”
Professor William Greene, a constitutional tender expert cited in the proposals, suggested in a 2017 paper that the initiative could trigger significant monetary changes. “Over time, as residents of the state use both Federal Reserve notes and silver and gold coins, the fact that the coins hold their value more than Federal Reserve notes do will lead to a ‘reverse Gresham’s Law’ effect,” Greene stated.
The bills will be assigned to Texas House committees when the 2025 legislative session begins on January 14.
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