Key Insights:
- The crypto tax exemption in Arizona has been moving forward with the latest crypto regulation bill.
- In November 2026, tax relief for virtual currencies may become constitutionalized with voter approval.
- The warning issued by Governor Hobbs reflects threats that run counter to pro-crypto efforts in other states, such as Texas.
Arizona’s Senate Finance Committee has advanced two significant bills aimed at exempting virtual currencies from property taxes. The two proposed bills that are aimed at taxing digital assets such as Bitcoin and Ethereum are Senate Bill 1044 (SB 1044) and Senate Concurrent Resolution 1003 (SCR 1003).
If the full legislature endorses SCR 1003, Arizona voters will cast their final ballot in November 2026.
Arizona Advances Crypto Regulation with Property Tax Exemption Bills
Arizona legislators are taking radical actions to make the state conducive to cryptocurrency. SB 1044 and SCR 1003 are a major milestone in the history of the changing attitude of the state toward crypto regulation.
In a bid to waive the property tax on virtual currencies, Senator Wendy Rogers (R-Flagstaff), a passionate crypto advocate, made an attempt to present the bills. The move is in line with the greater trend of Arizona embracing crypto-friendly policies within Arizona law.
The new legislative procedures signify a more significant investment in establishing a friendly climate for cryptocurrency in the state. It has already seen increasing interest in the sphere over the past few years.
The crypto regulation bills seek to establish virtual currencies as a digital expression of value acting as a medium of exchange, unit of account, and store of value, which are essential properties of assets such as Bitcoin and Ethereum.
Voter Decision on Constitutional Amendment
One of the most significant aspects of the proposed legislation is the possibility of amending the state constitution. Suppose SCR 1003 passes the entire legislature; it will be put on the November ballot for the electorate to vote on whether to amend the state constitution to exempt virtual currencies from property taxation.
This action will give Arizona citizens the opportunity to directly influence the state’s direction on cryptocurrency taxation.
The move to allow the voters to decide means that the change will be not only a legislative win but also a democratic one. If voters endorse it, the move would mark a historic change in how Arizona taxes crypto. It would also place Arizona among the first states to directly exempt digital currencies from property taxes.
Governor Hobbs’ Continued Resistance to Crypto Regulation Bill
The crypto community is still under pressure from Arizona Governor Katie Hobbs despite the wave in the state legislature. In 2025, she vetoed several bills related to cryptocurrencies. These included crypto regulations to create a Bitcoin Reserve Fund and to allow government agencies to accept cryptocurrencies for taxes and fines.
Her argument about the vetoes was the consideration of the instability of the crypto market and the dangers of introducing digital currencies into state financial systems.
Governor Hobbs has stated that cryptocurrencies will make state finances highly unstable. This has led to a poor relationship between the legislative body that advocates a tougher approach to crypto adoption and the Governor’s office, which has adopted a more conservative approach.
The proposal of tax exemption currently being developed has gone over well with the legislature. The result of the November 2026 vote might have far-reaching consequences on future crypto legislation in the state.