Minnesota has enacted a bill allowing banks and credit unions to offer cryptocurrency custody services, as the state continues examining the legal boundaries of various crypto-related services.
HF 3709, which was signed into law by Governor Tim Walz on Friday, permits "certain virtual-currency custody services to be offered and performed," according to the Minnesota Legislature website. The bill is set to take effect on Aug. 1, 2026.
Banking institutions and credit unions are required to maintain written policies governing risk management, internal controls, and security, among other compliance measures.
They must also submit written notice — including details of their risk management frameworks — to the Minnesota Commissioner of Commerce at least 60 days before commencing crypto custody services.
Notably, the bill also requires banks and credit unions to ensure the segregation of client assets from the institutions' own assets.
