CHICAGO, Ill., August 19, 2025 - The Illinois Blockchain Association (IBA), the nonprofit association representing Illinois' blockchain and cryptocurrency industries, applauds the collaboration that led to the significantly amended version of Senate Bill 1797, the Digital Assets and Consumer Protection Act, which was signed into law by Gov. Pritzker on August 18, 2025.

 

While the IBA initially opposed this legislation due to its overly broad scope and potential risks to innovation and entrepreneurship in Illinois, the association is pleased that the final version of the bill reflects significant improvements that limit scope, protect innovators, and provide definitional clarity.

 

As originally introduced, SB 1797 imposed burdensome requirements on startups, artists, students, and entrepreneurs experimenting with blockchain technology, treating them the same as large custodial financial institutions. That approach would have threatened more than 320 Illinois-based blockchain startups, $1.5 billion in venture capital investment, and countless jobs tied to this thriving sector.

 

“The IBA worked hand-in-hand with lawmakers during session to substantially narrow the bill's scope and focus regulatory oversight on entities that custody funds for Illinois consumers, not on innovators who never touch Illinois residents' assets," said Michael Frisch, general counsel for the Illinois Blockchain Association. "Several of our members provided testimony highlighting the real-world harms of the original draft and helped construct a more thoughtful framework that recognizes the diverse uses of blockchain across sectors including finance, art, gaming, and data security."

 

Thanks to these collaborative efforts, the final legislation adopts a targeted approach that exempts non-custodial developers, protects innovation in non-financial blockchain uses, and maintains Illinois' leadership as a hub for blockchain development. The IBA hopes to play an active role in the rule-making process in collaboration with the Illinois Department of Financial & Professional Regulation.

 

The IBA believes that good cryptocurrency policy is a non-partisan and bi-partisan issue, and we look forward to working with policymakers on both sides of the isle to achieve that.

 

The organization will continue to advocate for federal market structure legislation, which is fundamental to ushering in a blockchain-powered future that positions America-and Illinois-to lead. Consistent, federal policy that establishes guardrails for entrepreneurs, clarifies regulatory oversight, and protects consumers is essential to this growing industry. The IBA applauds the passage of the CLARITY Act in the House of Representatives and urges the Senate to take swift action on market structure legislation this year.

 

For more information or to join the Illinois Blockchain Association, please contact us at info@illinoisblockchain.org.

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