Illinois is taking a serious look at regulating the cryptocurrency market within its borders. A new bill, aiming to protect consumers from scams and shady practices, is making its way through the state legislature.
Protecting Consumers from Crypto Scams
Senate Bill 1797, also known as the Digital Assets and Consumer Protection Act, aims to curb the massive losses from crypto fraud in Illinois – over $160 million in 2023 alone! The bill would give the Illinois Department of Financial and Professional Regulation (IDFPR) the power to oversee crypto companies operating in the state. This means setting rules for how these companies operate, ensuring they’re honest and above board.
Senator Mark Walker, the bill’s sponsor, highlights the need for regulation, stating that while crypto offers opportunities, it also opens the door to fraud and deceptive practices. The bill aims to create a balance: protecting consumers while fostering responsible innovation in the crypto space. Companies would have until January 2027 to fully comply with the new rules.
The IDFPR would get significant power under the bill, including the ability to investigate, fine, and take action against companies that don’t play by the rules. Key provisions include:
- Registration: Crypto companies would need to register with the IDFPR.
- Transparency: Companies would have to be transparent about their fees and how they handle customer assets.
- Fraud Prevention: Companies would need to implement programs to prevent and reduce consumer fraud.
The bill passed a key committee vote and is now heading to the full Senate for consideration.
Illinois’s Bitcoin Reserve: A Separate Story
Separately, there’s another bill in Illinois – House Bill 1844, the Strategic Bitcoin Reserve Act – proposing to create a state-owned Bitcoin reserve. This bill would allow the state treasurer to accept Bitcoin donations and hold them as a state asset for at least five years. Regular reports on the reserve’s performance would be required. However, this bill hasn’t progressed much in the legislature and is currently awaiting review.
