Texas abandons BlackRock ETF to regain direct control of its bitcoins

Texas will transfer its strategic bitcoin reserve out of BlackRock’s IBIT ETF to switch to direct on-chain custody. The state issued an official tender on May 7 to recruit an institutional custodian capable of executing this switch within 60 days.

Texas takes direct control of its bitcoin reserve, away from ETFs

Since the creation of the strategic reserve, Texas managed its bitcoin exposure via the BlackRock IBIT ETF. It was a quick solution to implement. However, it deprives the state of actual ownership of the assets: holding ETF shares means having a claim on bitcoin, not bitcoin itself.

The tender document, published on the txsmartbuy.gov portal, sets a 60-day deadline after contract signing to finalize the transfer. The selected service provider will be responsible for secure custody, liquidity services for purchases and sales, and producing standardized reports as well as a public site displaying the reserve’s holdings and their valuation in real time.

This shift to direct custody places Texas in a similar dynamic to other states seeking to materialize their exposure to digital assets rather than going through intermediaries.

A committee to manage, a tender to execute

Alongside the tender, interim controller Kelly Hancock unveiled the four members of the advisory committee tasked with overseeing the reserve. The panel includes Laurie Dotter, an experienced institutional investment executive, Jamie McAvity, founder of Cormint Data Systems, Carla Reyes, law professor specialized in digital assets at Southern Methodist University, and Gary Vecchiarelli, chairman and CFO of CleanSpark.

This panel will therefore advise the state on custody methods and risk management. It will also oversee transparency obligations towards legislators and the public.

Notably: the tender opens the reserve to other “eligible” cryptos, without specifying which ones. Supporters of the founding law had indeed presented bitcoin, and potentially other high-market-cap assets, as hedging tools against inflation.

This move by Texas goes beyond a simple provider change. The state moves from passive exposure via a classic financial product to sovereign holding on the blockchain.

In short, a dedicated public site, an independent governance committee, a contractual execution deadline: the infrastructure is being methodically structured. If the reserve opens to other digital assets, this Texas model could become a reference for states still hesitating between ETFs and direct bitcoin adoption.