Bill
HB 5132
Limits governmental regulation of convertible virtual currency use, protecting self-hosted wallets and low-value transactions under $200.
Status snapshot
- Bill type: House Introduced Bill (HB 5132)
- Introduced: March 13, 2025 (filed); later electronically reproduced/introduced October 23, 2025
- Sponsor (per version): Rep. James DeSana (read first time and referred to Committee on Finance 10/23/2025)
- Current action (from provided record): Read 1st time and referred to Ways & Means (4/7/2025); later referred to Committee on Finance (10/23/2025)
Purpose and intent
- To limit governmental regulation of convertible virtual currency (CVC) use by individuals and entities within the state, protect users’ ability to hold/transact in CVC (including via self‑hosted wallets), and to restrict certain tax and reporting requirements for low‑value CVC transactions.
Key definitions (selected)
- Convertible virtual currency: a medium of exchange that has equivalent value as currency or acts as a substitute for currency even if it lacks all attributes of traditional currency.
- Covered user: any person who obtains CVC on their own behalf, irrespective of how it was obtained.
- Self‑hosted wallet: a digital interface used to secure and transfer CVC that gives the owner independent control over the CVC.
- Governmental entity: broadly defined to include the state and its agencies, courts, local governments (counties, cities, townships, school districts), and their officials.
Major provisions
- Prohibition on restrictions: Except as otherwise provided by law, governmental entities may not prohibit, restrict, or impair a covered user's ability to:
- Use CVC for personal purposes (including purchasing goods/services).
- Use a self‑hosted wallet or other means to conduct lawful transactions.
- Use CVC as collateral to secure loans or obligations.
- Tax and reporting limits (small transactions): For CVC transactions under $200.00, governmental entities may not:
- Impose a tax on the transaction; or
- Require reporting of the transaction for taxation purposes.
- Enforcement and remedies: A person harmed by a governmental entity’s violation may sue the governmental entity. A prevailing plaintiff is entitled to treble damages (3× actual damages).
Who is affected
- Covered users (individuals and businesses holding or transacting in CVC).
- State and local governmental entities — their regulatory, tax, and reporting authority over CVC would be restricted in the ways described.
- Potentially municipal finance/tax offices (reduced authority to tax/report low‑value CVC transactions).
- Does not create private‑party obligations or regulate non‑governmental actors.
Notable limits and considerations
- The act’s protections are subject to the caveat “except as otherwise provided by law,” which could allow existing statutory or federal requirements (e.g., federal AML/CFT obligations) to apply.
- Tax/reporting prohibition applies only to transactions under $200; larger transactions remain subject to taxation/reporting.
- Creates civil liability for governmental entities, which could affect enforcement and policy choices by state and local officials.
Prepared to expand on legal implications (preemption, interaction with federal law, fiscal impacts) or to compare this bill with other state CVC statutes if helpful.
Compiled from official sources — confirm details with the bill’s official record.
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