South Carolina Governor signed S.163 into law, creating one of the most comprehensive state-level frameworks for digital assets in the United States. The legislation, which passed during the 2025–2026 General Assembly session, protects Bitcoin users and miners while also banning central bank digital currency (CBDC) participation by state authorities.
Key provisions of the new law include:
Mining protections: The bill exempts individuals and businesses engaged in digital asset mining from state money transmitter licensing requirements. At the same time, it preserves the Public Service Commission’s oversight of energy consumption by mining operations, striking a balance between industry growth and energy regulation. Local zoning restrictions that could effectively ban mining are limited, giving operators more certainty when choosing locations.
Self-custody and tax protections: The law guarantees the right to self-custody digital assets and ensures that purchases of legal goods and services using cryptocurrencies are not subject to additional taxes solely because of the payment medium. These protections apply broadly to all digital assets—including cryptocurrencies and non-fungible tokens—not just Bitcoin.
CBDC prohibition: South Carolina authorities are now barred from accepting or requiring payments in any CBDC issued by the Federal Reserve or other federal agencies. Crucially, the law also bans state authorities from participating in any federal CBDC pilot program, a preemptive move designed to prevent the state from being used as a testing ground before residents can assess the implications.
Consumer protection: The Attorney General retains authority to prosecute fraud involving digital asset mining services, ensuring that consumer safeguards remain in place without classifying legitimate mining as a financial service.
The legislation addresses multiple regulatory vectors at once, treating digital assets as a permanent feature of the state’s economy rather than a category awaiting federal definition. Its passage comes amid ongoing federal regulatory uncertainty, positioning South Carolina as a welcoming jurisdiction for Bitcoin mining and digital asset ownership. If a federal CBDC pilot is launched, the law’s test-participation ban is likely to face legal challenges; otherwise, the framework is designed to function without immediate enforcement actions.
