Governor Mike Braun signed House Bill 1042 into law, formalizing new protections for digital asset users in Indiana and establishing guardrails on how state and local authorities can regulate cryptocurrency activity.
HB 1042 becomes law as Indiana expands legal clarity for digital assets
The measure, which was approved by the Indiana General Assembly earlier this session, establishes statutory definitions of cryptocurrency and limits the ability of state and local governments to impose discriminatory taxes, fees or restrictions specifically targeting digital assets.
Supporters describe the legislation as a “Bitcoin rights” framework designed to provide clarity and predictability for residents who hold or transact crypto.
Under HB 1042, state and local government units are prohibited from adopting rules that single out digital asset transactions for taxation or special treatment compared to other forms of payment. The law also strengthens the right of individuals to self-custody their digital assets, preventing most public agencies from restricting a person’s ability to hold cryptocurrencies in a private wallet.
Regulatory authority rests with the appropriate financial oversight agencies, including the state Department of Financial Institutions.
The legislation also opens the door to exposure to cryptocurrencies through certain state-run retirement and savings programs. Under HB 1042, designated public retirement and college savings plan administrators will be required to offer a self-directed brokerage option that includes at least one cryptocurrency-related investment election, such as a regulated exchange-traded fund linked to bitcoin.
The measure does not require pension funds to directly purchase or hold digital assets as part of their core portfolios; instead, it allows individual participants to decide whether they want to allocate a portion of their retirement savings to crypto through approved investment vehicles.
Supporters of the bill argued that the measure positions Indiana as a pro-innovation state amid a growing national debate over crypto regulation. By clearly defining cryptocurrency in law as a cryptographically secure means of digital exchange not issued by a central authority, lawmakers say the state is reducing ambiguity for courts, regulators and companies operating in the space.
The signing follows growing legislative activity in the United States focused on the rights and taxation of digital assets.
With the enactment of 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.