A recent legislative proposal in Indiana aims to revolutionize public retirement programs by mandating the inclusion of Bitcoin investment options. Introduced by State Representative Kyle Pierce, a Republican from Anderson, the bill, designated as House Bill 1042, was presented during a meeting of the House Financial Institutions Committee.
The key provisions of the legislation require state-run retirement and savings plans to offer cryptocurrency exchange-traded funds (ETFs) as standard investment choices for public workers. Additionally, certain public pension funds would be permitted to invest directly in crypto-linked ETFs. The state treasurer would also be given the authority to allocate funds from specific accounts into stablecoin-based ETFs. This move is seen as a way to provide residents with more financial flexibility in an increasingly digital economy.
Pierce emphasized that the bill aims to find a balance between investment choice and regulatory oversight. It also opens the door for the state to explore blockchain technology through designated pilot programs, showcasing a forward-thinking approach to digital assets in government.
Beyond enhancing retirement investment options, the bill seeks to limit local government powers regarding the regulation of digital assets. It would prohibit cities and counties from imposing “unreasonable” restrictions on digital asset usage—rules that can’t be harsher than those placed on traditional financial activities. This means protections would extend to crypto payments, private ownership of digital wallets, and mining operations.
Moreover, the legislation includes protections for self-custody of digital assets, specifying that private digital asset keys cannot be demanded without a court order, and only if no other legal methods are available. Local governments would also be restricted from zoning out mining facilities from industrial zones while protecting residential mining activities that comply with zoning regulations.
If enacted, this legislation would mark Indiana as the first state in the U.S. to mandate that publicly managed retirement programs include Bitcoin as a standard investment option. While some states allow limited crypto investment flexibility, none have yet imposed such a requirement.
Other states have taken various steps related to cryptocurrency. For instance, Oklahoma passed a law in 2024 protecting residents’ rights to hold crypto in self-custody wallets and blocking special taxes on Bitcoin transactions. In 2025, Kentucky recognized self-custody as a protected property right, while Wyoming allows public pension funds to invest in digital assets. Arizona and Florida have proposed laws enabling Bitcoin ETFs in retirement accounts, but Indiana’s approach stands out for its mandatory provisions.
The momentum for integrating crypto into retirement funds is growing nationwide. Michigan’s state retirement system recently tripled its holdings in Bitcoin ETFs to approximately $11.4 million. Meanwhile, Wisconsin has disclosed over $387 million in Bitcoin ETF exposure.
States are also expanding their use of digital assets beyond investments. For instance, Ohio has finalized plans to accept Bitcoin and other cryptocurrencies for state payments. California updated its Unclaimed Property Law to ensure dormant crypto isn’t automatically converted to cash when moved to state custody. New York City has established a municipal Office of Digital Assets and Blockchain, following an executive order from Mayor Eric Adams aimed at coordinating crypto policy.
At the federal level, regulatory efforts are gaining traction, with lawmakers preparing new frameworks that could influence state-level crypto policies. This includes anticipated updates on guidelines related to 401(k) crypto exposure, expected in 2026.
As the landscape of cryptocurrency continues to evolve, Indiana’s bold legislative initiative may set a significant precedent for other states seeking to navigate the integration of digital assets into public finance.
