Texas's New Initiative: Accelerating Move Away from the Dollar, Gold and Silver Become Legal Tender!

Introduction

Texas will officially recognize gold and silver as legal tender for everyday transactions by the end of June 2025. This news, which seems to challenge the dollar hegemony under the Federal Reserve (FRB), quickly became a hot topic not only within the economic and financial communities in the U.S. and abroad but also on social media. Why has Texas, not even one of the largest gold-producing states in the U.S., chosen to return to "hard money"? We delve into the background, system design, voices of support and opposition, and the future impact. texasscorecard.comchron.com

The Constitution and the "Gold and Silver Only as Currency" Clause

Article I, Section 10 of the United States Constitution states, "No State shall... make anything but gold and silver coin a tender in payment of debts." However, for a long time, states have treated federal currency, including dollar bills, as the de facto sole legal tender. This move to directly apply the constitutional wording at the state level is rare in financial history. capitol.texas.gov

Key Points of HB 1056

The passed House Bill 1056 (HB 1056) consists of three pillars.

1. Recognition of Gold and Silver as Legal Tender — It is explicitly stated in the Texas Government Code that "gold and silver are legal tender for the payment of debts and purchase transactions."

2. Creation of Transaction Currency — The Comptroller will establish a system where gold and silver deposited in the Texas Bullion Depository (state treasury) can be digitized in units such as grams and settled in dollar-denominated transactions via debit cards or mobile apps.

3. Participation is Completely Voluntary — Stores and citizens are not forced to accept or use it. texasscorecard.comlegiscan.com

Proponents' Logic—Inflation Hedge and the "Bible"

Representative Mark Dorazio (Republican), who submitted the bill, appealed for support by quoting the Bible: "Look at Genesis 2. God provided gold for transactions." Additionally, supporters argue that "dollars printed by the FRB lose value, but gold and silver are resistant to inflation" and "it can serve as a backup payment method during cyberattacks." chron.comchron.com

Opponents' Concerns—Tax System, Costs, and Counterfeiting Risks

Industry groups like the Texas Bankers Association criticize that "gold and silver are treated as 'collectibles' under the IRS, leading to capital gains tax on each transaction, complicating accounting," "the initial system cost is in the tens of millions of dollars," and "the cost of counterfeit detection and merchant education is a burden." The practical friction is significant. chron.com

Diverse Opinions on Social Media

• Supporters

  • "#GoldIsMoney! Texas is opening a true hard asset society" (Investment influencer @DonDurrett) x.com

  • "Stack bars instead of fearing inflation" (Conservative account @TexasEF) x.com

• Skeptics

  • "Are you going to shave gold coins at HEB (the state's largest supermarket)? You'll be in the red just from the fees" (Journalist @Joshua_Newman) x.com

  • On Reddit, joke threads like "A future where oxidation test kits line the checkout counter?" are gaining traction. cointelegraph.com

• Political Color

  • Governor Greg Abbott declared on X, "We have fulfilled the promise of the United States Constitution." x.com

Ripple Effects on Other States and the Federal Level

Seven states, including Utah and Wyoming, have already partially recognized the legal status of gold and silver, but Texas is the first to establish a state-led payment infrastructure. Experts point out, "If Texas, a giant economic zone, succeeds, a domino effect could occur." Conversely, without accompanying federal tax reforms, there is a risk of it becoming "unusable legal tender." cointelegraph.com

Roadmap to Implementation

• Summer 2025: Comptroller's office begins rule-making workshops

• Spring 2026: Pilot debit card tested for state employee salary payments

• May 1, 2027: Planned start of account openings for the general public

• End of 2027: Aim for operational terminals at 10 major retail chains

Expected Scenarios

(Author's estimate. See attached report for details)

Conclusion

Is the "revival" of gold and silver merely nostalgia, or is it a testbed for the post-dollar era? At the very least, Texas has presented a decentralized approach at the state level to the national currency system. Success or failure depends on tax system development and user experience. A social experiment envisioning a future where legal tender can be "chosen" has now begun in the land of the Alamo.