Arizona Governor Katie Hobbs has vetoed House Bill 2324, which aimed to establish a fund from seized cryptocurrency, sharing the proceeds between law enforcement and the state. The governor's letter highlighted that the bill would disincentivize local enforcement from collaborating with the state on digital asset forfeiture by removing seized assets from local jurisdictions. The House previously voted against the bill in May, but the Senate reconsidered it and the House passed it with a 34-22 vote on June 24. The veto could be overridden by a two-thirds majority in both chambers, although this seems unlikely unless some lawmakers change their votes. The proposed fund had intended to manage forfeited digital assets, allocating initial funds to the AG's office, with further distribution of profits among various state entities. Governor Hobbs has a history of vetoing crypto-related bills, including a previous initiative to create a Bitcoin reserve. Three bills have been rejected by her, while only one, aimed at integrating crypto assets into state financial frameworks, has passed.

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