Governor Mike Brown has signed Bill 1042 into law, creating new protections for users of digital assets in Indiana and how state and local authorities can regulate cryptocurrency activities.
Conclusion
- HB 1042 prohibits state and local governments from imposing discriminatory taxes or restrictions aimed at cryptocurrency transactions.
- The law protects the right of Indiana residents to own digital assets.
- Indiana officially defined cryptocurrency in state law, providing regulatory clarity for courts and institutions.
HB 1042 becomes law as Indiana expands legal clarity on digital assets
The measure, which cleared the Indiana General Assembly earlier this session, establishes legal definitions for cryptocurrency and limits the ability of state and local governments to impose discriminatory taxes, fees or restrictions that specifically target digital assets.
Proponents describe the legislation as a “Bitcoin Bill of Rights” framework designed to provide clarity and predictability for residents who own or deal in crypto.
Under HB 1042, state and local units of government are prohibited from enacting regulations that single out digital asset transactions for special taxation or treatment relative to other forms of payment. The law also strengthens the right of individuals to own digital assets, preventing most government agencies from restricting an individual’s ability to hold cryptocurrency in a private wallet.
Regulatory authority remains with the relevant financial supervisory authorities, including the Department of Public Financial Institutions.
The legislation also opens the door to the disclosure of cryptocurrencies under certain government-administered pension and savings programs. According to HB 1042, plan administrators of public savings and education plans are required to offer a self-directed brokerage option that offers at least one cryptocurrency-related investment option, such as a regulated exchange-traded fund linked to bitcoin.
The measure does not compel pension funds to directly purchase or hold digital assets as part of their core portfolio; Instead, it allows individual participants to allocate a portion of their retirement savings to crypto through approved investment vehicles or not.
Proponents of the bill argued that the measure would position Indiana as a pro-innovation state amid a growing national debate over crypto regulation. By clearly defining cryptocurrency in law as a digital medium of exchange that is secured by cryptography and not issued by a central authority, lawmakers say the state will reduce uncertainty for courts, regulators and businesses operating in the space.
The signing follows a surge in legislative activity across the United States targeting digital asset rights and taxation.
By passing HB 1042, Indiana joins a small but growing number of states that have codified protections for crypto holders while maintaining oversight through existing financial regulatory frameworks.
