Connecticut Lawmakers Pass Cryptocurrency Ban
Connecticut’s legislature has unanimously approved a bill that bars state and local government agencies from accepting payments in cryptocurrency or holding crypto assets. This legislation, known as House Bill 7082, “Act on Various Revisions on Gold Submission Act, State Payments and Investment in Cryptocurrency,” garnered bipartisan backing and was officially signed into law on Tuesday.
According to the bill’s terms, no state or local agency is permitted to either accept cryptocurrency payments or invest in cryptocurrency assets.
Additionally, this law prohibits the establishment of cryptocurrency reserves in Connecticut, placing it among a select few states in the U.S. that have outright rejected the notion of holding crypto reserves.
Democratic Support
The proposal, first introduced by Connecticut’s Joint Banking Committee back in February, was championed by Democratic figures like state legislators Ken Gacker, Sen. Patricia Miller, and Matthew Lesser. Following an initial vote in May, the bill gained significant support in the House, passing with 105 votes in favor, contrasted with just 42 dissenting votes from the May 14 vote. The final tally showed a resounding 148 votes for the bill, with zero opposition.
Some online commentators noted that the majority of Democrats played a key role in achieving this unanimous decision, especially considering broader criticism regarding digital assets during President Trump’s tenure.
One related proposal, known as the Modern Emoliment and Mistake Enforcement Act, or MEME Act, seeks to prevent federal officials from profiting off Meme Coin through their positions.
Critique of the Ban
Observers from the industry have suggested that Connecticut’s ban on crypto investment likely stems from fears surrounding volatility and regulatory issues. Still, they argue that such measures could hinder innovation. Aaron Brogan, founder of Brogan Law, remarked that the ban doesn’t present substantial changes and reflects a portion of the Democratic party’s opposition to the crypto sector.
Brogan added, “This demonstrates Connecticut’s symbolic stance against states that have adopted cryptocurrency and Bitcoin reserves.” He opined that state legislators often prefer to enact bans on non-existent matters, gaining media attention without addressing tangible issues.
Though the law has been passed, Brogan emphasized that it still requires approval from Connecticut’s governors, pointing to potential additional disclosure obligations aimed at private sector transactions. He mentioned that this could incur significant costs and complicate professional practices, much like California’s privacy laws for certain online services.
Growing Opposition to Bitcoin Reserves
Throughout Trump’s administration, there has been a surge in U.S. states considering Bitcoin reserve proposals, leading to a rise in Strategic Bitcoin Reserve (SBR) bills, totaling 31. However, Connecticut stands firm against such initiatives, having rejected an SBR bill as recently as February, alongside legislators from five other states.
In March, Utah’s Senate passed a Bitcoin bill but opted to remove sections enabling state accounts to invest in Bitcoin. Likewise, in April, Oklahoma’s Senate committee turned down SBR proposals in a close 6-5 vote. The landscape continued to shift in May, with Florida putting its SBR bill on indefinite hold and Arizona’s governor vetoing two crypto-related proposals.
As the conversation around cryptocurrency and state reserves evolves, Connecticut’s stance underscores ongoing debates about regulation and innovation in the crypto space.
