Illinois Governor Signs New Crypto Bills While Criticizing Trump's Industry Approach

Illinois Governor JB Pritzker signed two significant cryptocurrency regulation bills into law on Monday while taking direct aim at President Donald Trump's crypto policy stance. The governor criticized Trump for allowing what he termed "crypto bros" to influence federal cryptocurrency policy.

Digital Assets Consumer Protection Act Becomes Law

The first piece of legislation, the Digital Assets and Consumer Protection Act (SB 1797), grants the Illinois Department of Financial and Professional Regulation comprehensive authority over digital asset exchanges and cryptocurrency businesses operating within the state.

This landmark legislation establishes strict requirements for crypto companies and exchanges. These businesses must now maintain adequate financial resources, implement robust cybersecurity measures, establish anti-fraud protocols, provide clear investment disclosures, and meet customer service standards comparable to traditional financial institutions.

The bill successfully passed the Illinois Senate in April and represents a significant step toward comprehensive crypto regulation at the state level.

New Crypto ATM Regulations Take Effect

The second bill, the Digital Asset Kiosk Act (SB 2319), specifically targets cryptocurrency ATMs and kiosks throughout Illinois. This legislation introduces several consumer protection measures designed to combat fraud and excessive fees.

Under the new law, crypto ATM operators must register with state regulators and provide full refunds to victims of cryptocurrency scams. The legislation also caps transaction fees at 18 percent and limits daily transactions to $2,500 for new customers.

Representative Edgar Gonzalez Jr. emphasized the importance of these protections, stating that Illinois residents deserve reliable safeguards regardless of which financial services they choose to use.

Illinois Faces Significant Crypto Fraud Losses

The timing of these regulatory measures comes as Illinois grapples with substantial cryptocurrency fraud losses. According to FBI data, the state lost approximately $272 million to crypto fraud cases in 2024, making it the fifth-highest state nationwide for such losses.

This alarming statistic underscores the governor's rationale for implementing stricter crypto regulations as fraudulent schemes continue to evolve and target consumers.

Governor Continues Federal Policy Criticism

Governor Pritzker's office extended its criticism of the Trump administration's cryptocurrency approach, arguing that federal deregulation efforts increase consumer fraud risks. The governor's team specifically referenced Trump's signing of legislation that overturned an Internal Revenue Service rule expanding broker definitions to include decentralized finance exchanges.

The Illinois administration positioned its regulatory approach as a necessary counterbalance to what it views as insufficient federal consumer protections in the cryptocurrency space.

State Rejects Bitcoin Reserve Proposal

While implementing new regulatory frameworks, Illinois simultaneously rejected proposals to embrace cryptocurrency investments directly. The state quickly dismissed House Bill 1844, introduced by Representative John Cabello in January.

This bill proposed creating a strategic Bitcoin reserve for the state treasury, with plans to purchase and hold Bitcoin for five years. However, the legislation failed to advance beyond the committee stage, according to tracking by Bitcoin Laws.

Political Divide on Crypto Policy Emerges

The contrasting approaches to cryptocurrency regulation highlight a growing political divide at the state level. Republican-led states like Texas and Arizona have embraced the cryptocurrency industry with more favorable policies, while Democratic strongholds like Illinois favor cautious regulatory approaches.

This division has become more pronounced since the Republican landslide victory in November's elections, with states increasingly taking divergent paths on cryptocurrency policy implementation.

Consumer Protection Focus

Throughout both pieces of legislation, Illinois emphasizes consumer protection as the primary driving force behind its regulatory approach. The state argues that comprehensive oversight and strict operational requirements will better protect residents from the evolving tactics used by cryptocurrency fraudsters.

The legislation reflects Illinois' commitment to maintaining traditional financial service standards while accommodating new digital asset technologies and business models.

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