Gold and silver now legal tender in Texas under new law

Texas Joins National Movement with Precious Metals Currency Law

Texas has become the latest state to embrace a legal framework for using gold and silver as currency, following Governor Greg Abbott's signing of House Bill 1056 into law. This legislation marks a significant step in the growing movement across the United States to integrate precious metals into everyday financial transactions.

A New Era for Precious Metals

HB 1056 allows Texans to use gold and silver stored in the state-run Texas Bullion Depository for daily purchases through debit cards and mobile applications. This initiative positions Texas alongside other states such as Arkansas, Florida, and Missouri, which have also advanced similar legislation this year.

Governor Abbott emphasized the importance of the law, stating on social media that it authorizes the use of gold and silver as legal tender for everyday financial transactions. He highlighted that this move fulfills the promise of Article 1, Section 10 of the U.S. Constitution.

The law is set to take effect in phases starting in September 2026, with the full transactional system becoming operational by May 1, 2027. The Texas Comptroller will establish electronic systems that convert gold and silver holdings into U.S. dollars at the point of sale, making it easier for residents to use these precious metals in daily life.

Supporting Arguments and Public Backing

During legislative hearings in March, supporters of the bill framed it as a way to protect against inflation and return to constitutional money principles. Economist Kevin Freeman testified that while U.S. dollars are effective as units of account and means of exchange, they have lost their value as a store of value due to inflation. He cited public support for the measure, noting that Texas Proposition 7 received backing from 1.6 million voters, with 76.5% voting in favor.

Jason Cozens, founder of Glint, a company offering gold-backed payment cards, demonstrated the feasibility of the technology during committee testimony. He shared examples of using gold to pay for flights and meals, highlighting that merchants accept the payments through existing MasterCard networks without any additional costs or system changes.

Potential Legal Challenges

Despite the support, there are concerns that the law could face constitutional challenges. Victoria North, representing the Texas Comptroller’s office, warned that implementing HB 1056 could expose state employees to criminal liability due to conflicts with federal currency laws. She cited federal court precedent, stating that the U.S. government holds the sole power to coin money, and any attempt to supplant this could lead to violations of existing statutes.

North acknowledged she does not specialize in constitutional law but called HB 1056 “the only one” among bills she has reviewed that raises such concerns.

Legislative Perspective

Rep. Mark Dorazio, the bill’s author, argued that the system does not “coin money” but rather facilitates the use of existing legal tender as permitted by the Constitution. During committee hearings, he demonstrated his own Glint card, emphasizing that the measure makes gold and silver functional money.

Dorazio referenced a previous bill from 1984 that created the Texas bullion depository, suggesting that this new law is a continuation of efforts to recognize precious metals as a form of currency.

Broader Movement and Unique Features

Arkansas, Florida, and Missouri have also enacted similar bills this year, building on a movement that began with Utah’s legal tender law in 2011 and Oklahoma’s legislation in 2014. The Texas measure stands out due to its electronic payment infrastructure, which allows for practical everyday use of gold and silver, moving beyond symbolic recognition.

This development reflects a growing interest in alternative forms of currency and highlights the evolving landscape of financial systems in the United States. As more states explore the integration of precious metals into their economies, the implications for both consumers and the broader financial sector remain to be seen.