Wisconsin Bill Exempts Crypto Activities from Licensing

Assembly Bill 471, introduced Monday with bipartisan sponsorship from nine lawmakers, creates comprehensive exemptions from Wisconsin’s money transmitter licensing requirements for fundamental cryptocurrency activities. The legislation specifically protects individuals and businesses engaged in accepting cryptocurrency payments, using self-hosted or hardware wallets, operating blockchain nodes, developing blockchain software, and participating in staking operations. According to the bill text, these exemptions apply regardless of whether the activities involve exchanging one digital asset for another, provided there’s no conversion to legal tender.

The legislation takes a firm stance against regulatory overreach by explicitly prohibiting state agencies and local governments from “prohibiting, restricting, or otherwise impairing” residents’ ability to accept digital assets as payment or take custody of cryptocurrency using self-hosted solutions. This protection extends to node operators, software developers, and those engaged in digital asset mining or staking activities. The bill has been referred to the Committee on Financial Institutions for review, where its moderate bipartisan support suggests potential for advancement.

Industry experts view the legislation as a positive step toward regulatory clarity. Ruchir Gupta, co-founder of Gyld Finance, told Decrypt that “If this bill passes, it’ll help attract more crypto-native businesses to Wisconsin—think DEXs, staking providers, and other fully on-chain platforms.” Gupta emphasized the precedent-setting nature of the legislation, noting it “sets a useful precedent for other states by showing what regulatory clarity can look like” in the evolving cryptocurrency landscape.

However, Gupta cautioned that the bill’s impact has practical limitations. “Most providers operate across multiple states and will still be subject to FinCEN registration and compliance,” he explained, noting that the legislation “doesn’t really impact banks and payment processors” since traditional on- and off-ramps would continue operating under existing money transmitter licenses. This distinction highlights the bill’s focus on core blockchain activities rather than the broader financial infrastructure surrounding cryptocurrency.

The introduction of Assembly Bill 471 comes amid competing legislative priorities in Wisconsin’s approach to cryptocurrency regulation. Just months before this pro-crypto legislation emerged, SEC filings revealed that the State of Wisconsin Investment Board liquidated its entire $300 million stake in BlackRock’s iShares Bitcoin Trust during Q1 2025. This substantial Bitcoin ETF liquidation occurred just ahead of tariff-driven market turmoil that sent Bitcoin below $75,000, raising questions about the state’s strategic positioning in digital assets.

Simultaneously, Wisconsin’s Democratic lawmakers introduced twin bills in August requiring money transmitter licenses for crypto kiosks, citing a 99% surge in fraud complaints that cost victims nearly $247 million in 2024. These competing legislative efforts—one creating exemptions for fundamental crypto activities and another imposing stricter regulations on specific crypto infrastructure—reflect the complex balancing act states face between fostering innovation and protecting consumers in the rapidly evolving digital asset space.

Wisconsin’s legislative approach could serve as a model for other states grappling with cryptocurrency regulation. By explicitly exempting core blockchain activities from money transmitter licensing while maintaining federal compliance requirements through FinCEN, the bill attempts to strike a balance between innovation and oversight. The bipartisan nature of the legislation suggests growing political recognition of cryptocurrency’s economic potential, even as consumer protection concerns remain paramount.

The timing of this legislation is particularly significant given the recent market volatility and regulatory uncertainty surrounding Bitcoin and other digital assets. By providing clear exemptions for activities like staking, node operation, and self-custody, Wisconsin positions itself as potentially more attractive to blockchain developers and crypto-native businesses seeking regulatory predictability. As Gupta noted, the precedent set by this legislation could influence how other states approach similar regulatory questions, potentially creating a more standardized framework for cryptocurrency activities across state lines.