3 weeks ago
Minnesota Gov. Tim Walz signed HF 3709 into instrumentality this past week, authorizing state-chartered banks and recognition unions to clasp bitcoin and different virtual currencies connected behalf of customers.
Key Takeaways
- Minnesota Gov. Tim Walz signed HF 3709, letting state-chartered banks connection bitcoin and crypto custody.
- The instrumentality takes effect Aug. 1, 2026, requiring a 60-day Commerce Department announcement earlier services launch.
- St. Cloud Financial Credit Union reported 20% of members clasp crypto, signaling beardown section demand.
State-Chartered Banks successful Minnesota Will Be Able to Custody Bitcoin Under New Law
The legislation, present Chapter 93 of the 2026 Session Laws, takes effect Aug. 1, 2026. It applies lone to services offered connected oregon aft that date.
Under the caller law, qualifying institutions whitethorn supply virtual-currency custody services, which screen safekeeping, controlling, oregon administering integer assets successful a fiduciary, custodial, oregon non-fiduciary capacity. The instrumentality does not licence banks to trade, invest, oregon lend those assets.
Rep. Bernie Perryman (R-St. Augusta) sponsored the House version. He said the measure ensures Minnesota-based fiscal institutions are capable to germinate alongside their customers alternatively than forcing Minnesotans to trust connected out-of-state oregon offshore providers.
Institutions opting successful indispensable supply 60 days’ written announcement to the Minnesota Department of Commerce earlier launching services. They indispensable besides support written policies covering hazard management, interior controls, cybersecurity, concern continuity, and regulatory compliance.
Customer assets indispensable beryllium held separately from an institution’s ain holdings. Banks and recognition unions whitethorn usage qualified third-party work providers but clasp afloat compliance responsibility. The Department of Commerce tin prohibit oregon restrict the enactment if it determines the work is unsafe oregon unsound.
Local institutions cited nonstop subordinate request arsenic a driver. St. Cloud Financial Credit Union reported that astir 20% of its members already clasp virtual currency but deficiency trusted section custody options, often turning to unregulated oregon out-of-state platforms.
The Minnesota Credit Union Network and the Department of Commerce supported the bill, pointing to user protection, competitory positioning, and alignment with existing national guidance permitting banks to connection custody services.
The House passed HF 3709 connected April 30, 2026, by a 130-4 vote. The Senate passed an amended mentation connected May 6 by a 51-16 margin. The House concurred with Senate amendments connected May 11 by a 119-6 ballot earlier the measure went to the governor.
The custody instrumentality arrives alongside a abstracted measurement signed May 5, 2026, that bans virtual-currency kiosks statewide. That legislation, SF 3868, targets crypto ATM fraud aimed astatine seniors and requires operators to upwind down existing machines by Aug. 1.
Together, the 2 laws bespeak a calculated approach: regulated institutions summation a caller work line, portion unregulated, high-risk channels look removal.
The custody authorization is opt-in. No instauration is required to connection the service. It does not change Minnesota’s wealth transmission licensing model oregon grow slope authorization into broader crypto activities.
Minnesota joins a increasing database of states carving retired regulated crypto custody roles for assemblage banks and recognition unions arsenic integer plus ownership spreads among retail consumers.
The afloat enacted substance is disposable astatine the Minnesota Revisor of Statutes website nether Session Law Chapter 93.
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