Connecticut Enacts Sweeping Ban on State Crypto Holdings

Connecticut Governor Ned Lamont has signed into law one of the strictest anti-crypto measures in the United States, officially prohibiting the state from accepting, holding, or investing in digital assets.

The new legislation, H.B. 7082, was passed unanimously in both the Connecticut House of Representatives and Senate, signaling a decisive move away from public sector cryptocurrency adoption.

Under the new law, Connecticut and all its poltiical subdivisions are explicitly barred from accepting virtual currency as payment or establishing any form of digital asset reserve.

This comprehensive ban positions Connecticut as one of the most restrictive states on digital assets, sharply contrasting with the growing number of states embracing Bitcoin reserve legislation.

As of July 2025, 26 states have introduced 47 Bitcoin reserve bills, with Texas, New Hampshire, and Arizona already enacting state-level frameworks to hold Bitcoin in public treasuries.

The law goes beyond investment restrictions, imposing rigorous requirements on crypto businesses operating in Connecticut.

Crypto businesses are now required to provide extensive disclosures about the material risk, including warnings about fraud potential, market volatility , and the irreversible nature of transactions.

The state has also put safety nets in place for users under the age of 18 by requiring their parental verification.

Additionally, digital assets held by licensed money transmitters are now legally recognized as property of the customer, providing extra legal protection for Connecticut residents.

A Stark Contrast to National Crypto Adoption Trends

Connecticut’s move stands in sharp contrast to the broader national momentum toward state-level crypto adoption.

Texas, for example, has led the charge after it governor Greg Abbott signed the Senate Bill 12, marking the country's first ever state-funded Bitcoin reserve that is entirely separated from the state treasury.

New Hampshire also achieved a historic milestone by becoming the first state to pass laws allowing public funds to be invested in Bitcoin reserves.

Likewise, California is advancing pilot programs for crypto-based government payments, with frameworks for broader adoption expected by 2025.

Meanwhile, Arizona presents itself as a special case with governor Katie Hobbs vetoing comprehensive Bitcoin reserve legislation while simultaneously signing HB 2749, which creates frameworks for managing unclaimed digital assets.

Regulatory Patchwork and Ongoing Legislative Activity

Connecticut’s strict stance highlights the increasingly complex and fragmented regulatory landscape for digital assets in the U.S.

While some states—including Florida, Wyoming, and Pennsylvania—have withdrawn or failed to advance similar Bitcoin reserve bills, others like Michigan, Ohio, North Carolina, and West Virginia are actively considering or implementing legislation to allow public fund allocations to cryptocurrencies.

By enacting H.B. 7082, Connecticut has decisively distanced itself from the national trend of integrating digital assets into public finance.

The state’s comprehensive ban, coupled with enhanced consumer protections and compliance requirements, sets a new benchmark for restrictive state-level crypto regulation in the United States.