Indiana lawmakers pass crypto rights bill banning discriminatory taxes

Indiana lawmakers sent a bill to Governor Mike Braun that would expand legal protections for cryptocurrency users and require certain state retirement and savings plans to offer a self-directed brokerage option with at least one crypto investment choice.

House Bill 1042 (HB1042) for the “regulation and investment of cryptocurrency” cleared the legislature on Wednesday, with 59 lawmakers voting in favor and 33 against, according to data from Legiscan.

The bill seeks to protect Bitcoin (BTC) and cryptocurrency investor rights, ban discriminatory crypto taxes and open the door for digital asset holdings in state retirement plans.

The bill is headed to Braun for his signature. If signed, most provisions will take effect July 1, while the retirement-plan self-directed brokerage requirement would take effect later.

Indiana House Bill 1042, history. Source: Legiscan

A handful of US states have already signed crypto investor protection bills, including Oklahoma in November 2024 and Kentucky in March 2025.

Pennsylvania’s House Bill 2481 (HB2481) for crypto investor protection rights passed in October 2024 with strong bipartisan support, but has yet to be signed into law.

Indiana’s cryptocurrency rights bill stands out from the others as the only piece of legislation seeking to offer self-directed brokerage accounts to facilitate crypto retirement plans.

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Retirement plans add crypto option

The bill would allow Indiana citizens to hold Bitcoin and digital assets as part of their retirement plans for the first time. 

If signed, the bill would require certain state retirement and savings plans to offer self-directed brokerage accounts with at least one cryptocurrency investment option by July 1, 2027.

This would extend to the legislators’ defined contribution plan, the Hoosier START plan, specified public employees’ retirement funds and specified teachers' retirement fund plans, among others.

Indiana House Bill 1042. Source: Legiscan

Moreover, the bill includes other key provisions that protect the rights of crypto investors from future regulatory crackdowns.

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State rules limited on crypto

Indiana’s bill would restrict state and local public agencies from adopting or enforcing rules that would prohibit lawful crypto payments, self-custody or mining, subject to the bill’s carve-outs.

Under the legislation, public agencies, excluding the Department of Financial Institutions, will be prohibited from adopting regulations that prohibit an individual’s ability to accept digital asset payment for legal goods and services, take custody of their crypto holdings or impose taxes and fees on crypto payments and self-custodied holdings.

The bill also prohibits the enforcement of regulations that would prohibit crypto mining operations for businesses or individuals.

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