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HB 1029

NC Digital Asset and Stablecoin Act.

2025-2026 Session Introduced by Brian Biggs and 12 co-sponsors

NC HB1029 establishes a regulator-backed framework for digital assets and stablecoins: mandatory custody, reserves, disclosures, audits, and licensing for stablecoins.

Regular Message Received From House
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Bill Summary · HB 1029

Summary of HB 1029 (NC Digital Asset and Stablecoin Act)

Session: 2025 | Jurisdiction: North Carolina | Sponsor: Rep. Chesser

This bill proposes two main frameworks:
1) Digital Asset Financial Act ( Part I )
2) North Carolina Stablecoin Act ( Part II )

The measures establish regulatory safeguards for digital assets and create a state licensing regime for payment stablecoins.

1) Purpose and intent

  • Establish a comprehensive statutory framework to govern digital assets held by financial institutions operating in North Carolina.
  • Create a licensing, reserve, disclosure, and consumer-protection regime for payment stablecoins issued or offered in the state.
  • Align state rules with federal standards (via GENIUS Act references) and provide supervisory authority to the State Banking Commission and the Credit Union Commission.

2) Key provisions and changes

A. Digital Asset Financial Act (Article 26 of Chapter 53)

  • Definitions (53-441):

    • Clarifies terms: digital asset, digital asset custody services, fiduciary vs non-fiduciary capacity, subcustodian, staking, staking rewards, keys, etc.
    • Distinguishes customer-owned assets and balance-sheet treatment.

  • Digital asset custody services (53-442)

    • Notification: Banks/credit unions must notify regulators at least 60 days before offering custody services.
    • Fiduciary approval: Fiduciary custody requires written regulator approval; authorities can condition scope.
    • Customer agreements: Written custodial agreements required; disclosures include that assets are not deposits and not FDIC/NCUA insured.
    • Custody structure: Pooled or segregated custody permitted; must maintain records of each customer’s interest.
    • Reserve requirement: At least 100% reserve for each asset type; pooled custody must still maintain individual customer reserves.
    • Independent annual audits: Annual audit by a qualified independent auditor; results provided to regulator and available to customers.

  • Subcustody of digital assets (53-443)

    • Allows subcustodians with disclosure; the primary institution remains responsible for custody.
    • Eligible subcustodians include banks, SPDI banks, or money transmitters.
    • Must maintain 100% reserves at subcustodian; insurance requirements; records auditable by regulator.

  • Staking of digital assets (53-444)

    • Institutions must notify regulators 60 days prior; fiduciary staking requires approval.
    • Defaults: Assets may be staked unless the customer opts out; must disclose risks, lock-up periods, and fees.
    • Ownership and off-balance sheet: Staked assets and rewards belong to customers; not on the bank’s balance sheet.
    • Use of subcustodians for staking allowed with ongoing oversight.
    • Risk management, audits, and insurance: Staking activities included in audits; institutions must have risk policies and adequate insurance.

  • Digital asset transaction services (53-445)

    • Regulator notice: 60 days prior to offering transaction services.
    • Fiduciary capacity allowed; customer disclosures required (pricing methodology, fees, settlement timelines).
    • Execution: Must act on customer instruction or discretionary fiduciary authority; prohibit proprietary trading.
    • Subcustodians/execution agents allowed with due diligence and record-keeping.

  • Compliance, AML, cybersecurity (53-446)

    • Institutions must comply with Bank Secrecy Act, AML programs, sanctions, and data/privacy laws.
    • Incident notification within 72 hours of material cybersecurity incidents.
    • Records retention and designated compliance officers.

  • Prohibition on rehypothecation (53-447)

  • Unclaimed digital assets (53-448) and reporting (53-449): Integrates with existing abandoned property regimes; timelines align with 116B.

  • Rulemaking and enforcement (53-449, 53-450)

    • State Banking Commission and Credit Union Commission may issue rules and advisory guidance.
    • Enforcement includes corrective actions, temporary emergency orders, cease-and-desist, suspension/revocation, and civil penalties.

  • Transition/designations related to abandoned digital assets (116B cross-references)

    • New definitions and adjustments to allow handling of abandoned digital assets through existing abandoned-property procedures.
    • Delivery of abandoned digital assets to qualified custodians designated by the Treasurer; orderly liquidation provisions.

  • Effective date and staged implementation

    • Certain subsections become effective 18 months after enactment; other provisions tie into phased reporting and custodial requirements.

B. 116B Amendments (Unclaimed Property)

  • Defines “digital asset” within abandoned property framework.
  • Establishes procedures for reporting, notices, and delivery to qualified custodians.
  • Introduces a 3-year holding period for digit assets delivered to the Treasurer or custodian, with owner claims possible during holding.

C. Administrative provisions for digital assets

  • Allows rulemaking, annual examinations, audit requirements, and ongoing reporting.
  • Establishes the basis for penalties and appeals.

3) Who or what would be affected

  • Financial institutions in North Carolina (banks and state-chartered credit unions) offering:
    • Digital asset custody (fiduciary or non-fiduciary)
    • Digital asset staking
    • Digital asset transaction services
    • Use of subcustodians and execution agents
  • Customers of these financial institutions (depositors, asset holders, and beneficiaries) who hold or transact in digital assets or stablecoins.
  • Issuers of payment stablecoins (both domestic and certain foreign entities under GENIUS Act provisions):
    • Licensed stablecoin issuers
    • State-chartered depository institutions or credit unions that issue stablecoins via subsidiaries or direct issuance
    • Foreign entities with provisional or full licenses under specific conditions
  • Treasurers and holders of abandoned digital assets, integrating with the state’s unclaimed property regime.
  • Regulators: North Carolina State Banking Commission, North Carolina Credit Union Commission, and state securities/banking oversight processes.

4) Procedural and timeline aspects

  • Regulatory notifications:
    • 60 days prior to custody or staking service initiation; 60 days prior to digital asset transaction services.
  • Initial licenses and ongoing oversight for stablecoins:
    • Licensing decisions: Either provisional licenses up to 6 months (renewable once) or full license determinations within 120 days after complete application.
    • Ongoing obligations include monthly reserve attestations, annual examinations, audited statements, and periodic reporting.
    • Fee structure: Initial application filing fee of $2,500; ongoing annual assessments scheduled and tiered by outstanding stablecoin volume.
  • Reserve and redemption requirements:
    • 100% reserve for stablecoins; assets must be held with custodians and segregated; redemption policies disclosed publicly.
    • In event of redemption stress or delays, the regulator can grant temporary extensions.
  • Abandoned digital assets:
    • Initial cross-referencing to 116B; staged implementation begins 18 months after enactment for certain sections.
    • The Treasurer designates a qualified custodian and provides reporting guidance prior to the first reporting cycle.
  • Penalties and enforcement:
    • Civil penalties of up to $5,000 for first offenses, up to $10,000 for subsequent offenses; civil penalties are subject to hearing rights and potential suspension/revocation of authority.

Bottom line

HB 1029 creates a structured, regulator-backed framework for digital assets in North Carolina, focusing on:
- Safe custody with explicit fiduciary/non-fiduciary roles and clear disclosures
- Independent audits, reserve requirements, and risk management for custodial and staking activities
- A comprehensive licensing and oversight regime for payment stablecoins, including reserve, redemption, and consumer protection standards
- Integration with existing unclaimed property laws for digital assets and a staged implementation timeline

If enacted, the bill would significantly expand state-level governance of digital assets and stablecoins, affecting banks, credit unions, stablecoin issuers, and their customers.

Compiled from official sources — confirm details with the bill’s official record.

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