Indiana lawmakers have approved House Bill 1042, marking a decisive move in the state-level battle over cryptocurrency regulation in the United States.
The measure was passed with 59 votes in favour and 33 against, according to legislative records.
The legislation has now been sent to Governor Mike Braun and awaits his signature before it can become law.
If endorsed, the majority of its provisions are scheduled to come into force on 1 July.
The bill sets out a structured framework governing the regulation and investment of cryptocurrency within the state.
It blocks local and state public bodies, with the exception of the Department of Financial Institutions, from introducing rules that would prevent crypto payments for lawful goods and services.
It safeguards the right of individuals to hold their digital assets in personal custody without interference from authorities.
The legislation also bars the introduction of targeted taxes or fees aimed specifically at cryptocurrency payments or assets held in self-custody.
It further prevents regulators from imposing measures that would effectively ban cryptocurrency mining by businesses or private individuals.
Lawmakers argue that the bill strengthens legal certainty for crypto users and businesses operating in Indiana.
A notable feature of the measure is its section addressing public retirement schemes.
The proposal would require selected public savings and retirement plans to provide self-directed brokerage accounts with at least one cryptocurrency investment option.
This requirement would apply to defined contribution plans for legislators, the Hoosier START programme, certain public employee retirement funds, and teacher-related funds.
Unlike the broader provisions, the retirement component would not need to be implemented until 1 July 2027.
Supporters view the initiative as positioning Indiana as a testing ground for balanced digital asset regulation.
The bill arrives amid ongoing federal discussions around broader crypto frameworks, including the CLARITY Act.