IllinoisSB1797104th General Assembly (2025–2026)SenateWALLET

DIGITAL ASSETS & CONS PROT ACT

Sponsored By: Mark L. Walker (Democratic)

Became Law

assignmentsexecutivefinancial institutions and licensing

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Bill Overview

Analyzed Economic Effects

11 provisions identified: 6 benefits, 1 costs, 4 mixed.

Clear fees, fair trading, live help

Companies must give you a written fee schedule, insurance details, and a year of outage history you can keep. They must give at least 14 days’ notice before big fee or term changes and send trade confirmations (or a daily summary if disclosed). Exchanges must certify they reviewed listing risks, set delisting and notice plans, and work to get you the best outcome, with reviews at least every 6 months. Websites must show a toll-free number, and firms must handle disputes, errors, and complaints fairly. Breaking these rules is a violation of the Consumer Fraud Act.

Your crypto kept separate and safe

If a company holds your digital assets, it must keep them separate from its own and hold enough to cover all customers. It cannot use or lend your assets unless you direct it. If the company fails, your assets are held in trust for you and are not the company’s property. The Department can add safeguards, like audits, qualified custodians, and tighter rules to protect customer assets.

Stronger crypto enforcement and right to sue

The Department regulates digital asset businesses, investigates complaints, and can subpoena, examine, and take action. The state, through the Attorney General or a State’s Attorney, can sue to stop illegal acts and ask courts to appoint a receiver or conservator and order other relief. If the Department wins, it can recover its costs and attorney fees. An Illinois resident can sue for violations of the consumer protection article, and if they win, the court may order the wrongdoer to pay their attorney fees and court costs.

Crypto firms must register and set aside funds

Any business that serves Illinois residents with digital asset services must register unless exempt. Applications must name owners and leaders, give five years of business history, list other licenses and legal actions, and provide current financial statements. Registrants must keep a surety bond or a U.S. dollar trust account, in an amount the Department sets, to protect residents. The Department can require more security. A firm that needed registration cannot sue to collect fees for those services unless it was validly registered the whole time.

Stronger compliance, cybersecurity, and AML

Registrants must keep board‑approved compliance programs and name qualified compliance leaders. They must run cybersecurity programs with written policies approved at least yearly and a qualified lead. They must run anti‑money laundering programs that follow federal law and file required Bank Secrecy Act reports. Firms must maintain enough capital and liquidity, with liquidity in cash or high‑quality liquid assets. The Department can raise minimums and firms must show proof within 15 days.

Tougher oversight and penalties for firms

The Department can make rules, examine firms anytime, and require records for 5 years, produced within 3 days on request. Firms must report major changes within 15 days; control presumptions apply at 10% ownership or 25% voting power, and merger plans need approval. The Secretary runs a complaint office and can subpoena, take documents, and work with other regulators. The Department can order restitution, revoke or suspend, issue cease‑and‑desist, and seek court relief. Daily civil penalties can reach $100,000 for unlicensed actors, $75,000 for fraud‑related violations, and $25,000 for other violations, accruing until fixed. Emergency actions may proceed before a hearing, with a fast post‑action hearing and court review available.

Industry exam fees and annual assessments

Regulated businesses pay to fund this oversight. The Department can charge fees, fines, and assessments. Annual assessments are split between transactions and custody, with each firm’s share based on its Illinois volume and assets held for residents. Exams cost $150 per hour per examiner plus travel. Money collected goes into a Consumer Protection Fund. Providers may pass some costs to customers.

Phase-in dates for new crypto rules

The Department may adopt rules now, but they cannot take effect before January 1, 2026. Key consumer‑protection violations for covered persons and exchanges start January 1, 2027. Acting without registration is not treated as a violation until July 1, 2027. This gives businesses time to comply, but delays full protections.

Who must follow Illinois crypto rules

The law covers anyone, anywhere, who offers digital asset services to Illinois residents, unless federal law preempts it. It lists who is not covered, like governments, insured banks, and merchants that only accept crypto as payment. The Department can make rules and grant conditional or full exemptions when that protects residents and serves the public interest. It is illegal to structure products or deals to dodge these rules; such activity is treated as covered.

Some crypto oversight records stay private

Some supervisory records at the Department are confidential and not open under FOIA. The Secretary controls when these records are shared with law enforcement or other regulators and can limit disclosure. FOIA now also exempts any records the digital assets law bars from release.

New special purpose trust companies

The law creates special purpose trust companies to act as fiduciary custodians for digital and other assets. These companies must get a certificate of authority; natural persons cannot act as them. Violations are a Class A misdemeanor and can be stopped by court order. The Department sets rules on capital, collateral, offices, and powers, and applies key fiduciary articles. These companies can merge with or convert to State banks under existing procedures.

Sponsors & Cosponsors

Sponsor

Mark L. Walker
Democratic • Senate

Cosponsors

Adriane Johnson
Democratic • Senate
Camille Y. Lilly
Democratic • House
Christopher Belt
Democratic • Senate
Cristina Castro
Democratic • Senate
Edgar González, Jr.
Democratic • House
Graciela Guzmán
Democratic • Senate
Javier L. Cervantes
Democratic • Senate
Karina Villa
Democratic • Senate
Laura Ellman
Democratic • Senate
Mary Edly-Allen
Democratic • Senate
Michael E. Hastings
Democratic • Senate
Mike Porfirio
Democratic • Senate
Mike Simmons
Democratic • Senate
Paul Faraci
Democratic • Senate
Rachel Ventura
Democratic • Senate
Robert Peters
Democratic • Senate

Roll Call Votes

All Roll Calls

Yes: 264 • No: 125

Senate vote • 6/1/2025

House Committee Amendment No. 1 Senate Concurs

Yes: 41 • No: 15

Senate vote • 5/31/2025

House Committee Amendment No. 1 Motion To Concur Recommended Do Adopt Executive;

Yes: 9 • No: 4

House vote • 5/30/2025

Third Reading - Short Debate - Passed

Yes: 76 • No: 38 • Other: 1

House vote • 5/28/2025

Do Pass as Amended / Short Debate Financial Institutions and Licensing Committee;

Yes: 7 • No: 4

House vote • 5/27/2025

Motion to Suspend Rule 21 - Prevailed

Yes: 75 • No: 39

Senate vote • 4/10/2025

Third Reading - Passed;

Yes: 39 • No: 17

Senate vote • 4/9/2025

Senate Floor Amendment No. 2 Recommend Do Adopt Executive;