Indiana has taken a bold step in the digital asset landscape, passing legislation that will allow public retirement and savings plans to invest in bitcoin, cryptocurrency, and crypto-linked exchange-traded funds (ETFs). The bill, HB 1042, is expected to be signed into law by Governor Mike Braun within the next 10 days, positioning Indiana at the forefront of states embracing digital assets in public investment portfolios.
Under the new law, Indiana’s public retirement boards, deferred compensation committees, and annuity savings programs will be required, by July 1, 2027, to offer self-directed brokerage accounts that include at least one cryptocurrency investment option. This move aims to provide public employees and retirees with more diverse investment opportunities, including exposure to the rapidly growing cryptocurrency market.
Empowering Public Employees and Retirees
The legislation defines cryptocurrency as a virtual currency that is not issued by a central authority, functions as a medium of exchange, and relies on encryption technology to regulate issuance, verify transfers, and prevent counterfeiting. These self-directed accounts will give plan participants the ability to select cryptocurrency investments in accordance with the boards’ established investment guidelines, track account valuations, and pay administrative fees associated with digital asset holdings.
Lawmakers emphasize that the new law will empower public employees and retirees to make informed investment decisions, offering them greater control over their financial futures. Self-directed accounts will enable participants to manage crypto alongside traditional investments such as stocks, bonds, and ETFs, with boards setting limits and guidelines to mitigate risk.
Statewide Standardization and Oversight
The legislation also clarifies the responsibilities of retirement boards and deferred compensation committees, which will oversee the crypto investment options, set fees, and ensure that account values accurately reflect market prices. This standardization across state pensions, deferred compensation programs, and annuity accounts will provide consistent access to digital assets for all Indiana participants.
Indiana’s move aligns with a broader trend of states and public entities considering digital assets as part of their long-term investment strategies. This trend has been accelerated by President Donald Trump’s directive to create a U.S. Bitcoin Strategic Reserve, encouraging states to explore the potential of cryptocurrencies in their investment portfolios.
Addressing Crypto ATM Fraud
In a separate but related measure, the Indiana legislature has voted to ban the operation of virtual currency kiosks, commonly known as bitcoin or crypto ATMs, across the state. This ban responds to increasing reports of fraud tied to these machines, particularly in cities like Evansville, where residents lost approximately $400,000 in scams connected to crypto ATMs in 2025.
The prohibition aligns with broader concerns about crypto ATM fraud nationwide. The FBI reported nearly 11,000 complaints related to crypto ATM scams in 2024, marking a 99% increase from the previous year, with losses totaling an estimated $240 million in the first half of 2025. The ban will be enforced under deceptive consumer sales laws by the state attorney general.
Looking Forward
Indiana’s approval of bitcoin investments in public retirement plans represents a significant step toward integrating digital assets into the financial mainstream. As more states follow suit, the landscape of public investment is likely to evolve, offering new opportunities and challenges for investors and regulators alike. The future of digital asset adoption in public retirement plans is promising, but it will require careful oversight and education to ensure that participants can navigate this new terrain with confidence and security.
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