Bitcoin Policy for Rhode Island
An educational resource for Rhode Island legislators exploring how Bitcoin and digital asset legislation can strengthen our state's economy, protect consumers, and position Rhode Island as a leader in financial innovation.
Economic Growth
Bitcoin-friendly policies attract businesses, create jobs, and generate new tax revenue streams. Texas has already purchased $5M in Bitcoin through their strategic reserve.
Consumer Protection
Rhode Island enacted crypto ATM consumer-protection laws in 2025, requiring licensing and safeguards to reduce fraud while enabling innovation.
Innovation Leadership
States leading on digital asset policy are attracting tech talent and investment. Rhode Island can position itself at the forefront of financial technology.
Rhode Island Bitcoin & Blockchain Legislation
Current and previous bills before the Rhode Island General Assembly. Bills from the 2025 session that died in committee are candidates for reintroduction.
📋 2026 Session — Active
Bitcoin Tax Exemption for Small Transactions
Creates a limited income tax exemption for Bitcoin transactions conducted by Rhode Island residents and businesses. Bitcoin sales or exchanges would be exempt from state income and capital gains taxes up to $5,000 per month, with a $20,000 annual cap.
Benefits for Rhode Island
- Simplifies tax compliance for everyday Bitcoin users
- Encourages small business Bitcoin adoption
- Reduces administrative burden through self-certification
- Positions RI as Bitcoin-friendly for retail transactions
- Could make RI first state with Bitcoin payment tax exemption
Special Legislative Commission to Study Blockchain and Cryptocurrency
Creates a 5-member special legislative study commission to review blockchain and cryptocurrency, including NFTs. The commission—chaired by the Secretary of Commerce—will study the scope of blockchain nationwide, current RI laws, and recommend legislation to make Rhode Island the most forward-thinking state for blockchain while ensuring consumer protections. Interim report due January 2027; final report January 2028.
Benefits for Rhode Island
- Brings together Commerce, DBR, academia, finance, and securities experts
- Comprehensive study of blockchain applications and regulations
- Directly builds on 2025's H.5810/S.0373 momentum
- Positions RI to craft informed, pro-business blockchain policy
- Ensures consumer protections are developed alongside innovation
📜 2025 Session — Candidates for Reintroduction
These bills progressed but died when the session ended. They represent strong foundations for 2026 legislation.
Studying Blockchain's Potential — Legislative Commission
Creates a special legislative commission to study blockchain and cryptocurrency. Studies applicability of blockchain technology for use cases such as voting, land registries, and public records. Evaluates tax implications, revenue opportunities, and streamlines processes to address cost inefficiencies.
Benefits for Rhode Island
- Promotes blockchain and digital asset innovation in RI
- Well-researched approach could make RI a blockchain/fintech hub
- Commission can study tax treatment enabling compliance
- Similar to Colorado SB18-086 (2018) and Mississippi HB1214 (2024)
Rhode Island Economic Growth Blockchain Act
Establishes a regulatory sandbox allowing blockchain and digital asset companies to test innovative financial products with temporary exemptions from certain regulations. Allows for Special Purpose Depository Institutions (SPDIs) designed specifically to provide banking services to blockchain businesses, requiring 100% liquid reserves.
Benefits for Rhode Island
- Public-private partnership could incentivize innovators to come to RI
- Only Wyoming and Nebraska currently have SPDIs
- Regulatory sandbox attracts fintech companies
- Similar to Wyoming HB74 (2019) and Nebraska LB648 (2021)
Rhode Island Digital Asset Retention Act — Strategic Reserve
Authorizes the state treasurer to invest up to 10% of uncommitted state funds in digital assets like Bitcoin to hedge against inflation. Mandates digital assets be held through qualified custodians using secure custody solutions, ensuring robust security measures are in place.
Benefits for Rhode Island
- Bitcoin as "digital gold" could preserve state's purchasing power
- Asymmetric return profile: small allocation enhances returns without excessive risk
- Could acquire ~2,890 BTC from rainy day funds at $100K/BTC
- Similar to NH HB302 (passed 05/2025) and Texas SB21 (passed 03/2025)
Protecting Citizens' Private Keys
Prohibits compelling individuals to disclose their private cryptographic keys in legal proceedings related to digital assets or identities. Allows compelled disclosure only if a public key is unavailable or insufficient to access the necessary information.
Benefits for Rhode Island
- Aligns with existing legal protections for sensitive information
- Protects property rights of digital asset holders
- Opportunity for statewide education on private key safety
- Similar to Wyoming HB0086 (passed 2023)
Reducing Friction for Digital Asset Payments
Allows for the sale of Bitcoin to be state tax exempt if the amount is less than $1,000, limited to 10 transactions in a 30-day cycle. Designed to enable everyday Bitcoin payments without tax burden on small transactions.
Benefits for Rhode Island
- Rhode Island could be first state with de minimis tax exemption
- Small businesses could accept bitcoin, stimulating economic growth
- Enables RI residents to participate in modern payments infrastructure
- Similar to federal Virtual Currency Tax Fairness Act proposals
Frequently Asked Questions
Addressing common concerns and questions from legislators about Bitcoin policy.
This is a common misconception. According to Chainalysis, illicit activity represents less than 1% of all cryptocurrency transactions. Bitcoin's transparent blockchain actually makes it easier to trace criminal activity than cash.
Law enforcement agencies including the FBI and IRS have developed sophisticated tools to track Bitcoin transactions. Many high-profile criminal cases have been solved precisely because criminals used Bitcoin, which leaves a permanent public record.
The U.S. dollar remains the currency of choice for money laundering and illicit finance globally. Bitcoin-friendly policies with proper regulation actually improve our ability to monitor and prevent financial crime.
Sources: Chainalysis Crypto Crime Reports, FBI Criminal Investigative Division
Bitcoin mining's energy profile has improved dramatically. Over 50% of Bitcoin mining now uses renewable energy sources, making it one of the most sustainable industries globally.
Importantly, Bitcoin miners are uniquely positioned to use stranded energy that would otherwise be wasted—including flared natural gas, excess renewable capacity, and energy in remote locations without grid access.
In Texas, Bitcoin miners participate in demand response programs, reducing energy consumption during peak demand and actually stabilizing the grid. Rhode Island could explore similar programs.
For context, the global banking system consumes approximately 2-3x more energy than Bitcoin mining, when accounting for branches, data centers, ATMs, and transportation.
Sources: Cambridge Bitcoin Electricity Consumption Index, Bitcoin Mining Council Reports
Bitcoin is volatile in the short term, but its long-term trajectory shows consistent appreciation. Over any 4-year period in its history, Bitcoin has outperformed every other asset class.
Strategic reserve legislation typically includes safeguards:
- Caps on allocation (e.g., 5% of funds in New Hampshire)
- Market cap requirements (only assets over $500B)
- Professional custody and management requirements
- Long-term holding strategies, not short-term trading
Texas's approach—starting with a modest $5M investment—demonstrates how states can gain exposure while managing risk. The legislation protects the reserve from being easily dismantled by future legislatures.
Sources: Bitcoin Historical Data, State Strategic Reserve Legislation Analysis
Rhode Island has already taken action here. In 2025, the state enacted crypto ATM consumer-protection laws requiring kiosk operators to be licensed and comply with safeguards aimed at reducing fraud.
Additional protections in pending legislation (H.5121) include:
- Daily transaction limits ($1,000)
- Fee caps ($5 or 3%)
- Mandatory licensing as money transmitters
- Refund eligibility for first-time fraud victims
- Warning labels and consumer education requirements
These balanced approaches protect consumers while preserving access to innovative financial technology.
Sources: Rhode Island H.5121, RI Department of Business Regulation
Bitcoin uniquely benefits those underserved by traditional banking. Unlike stocks or real estate, anyone can participate with any amount—there's no minimum investment.
The tax exemption bill (S.2021) specifically targets small transactions—up to $5,000/month—designed for everyday purchases and small savers, not wealthy traders.
Bitcoin enables:
- Savings protection against inflation for working families
- Lower-cost remittances for immigrant communities
- Financial access for the unbanked and underbanked
- Small business payment options with lower fees than credit cards
By making Rhode Island Bitcoin-friendly, we're expanding financial opportunity for all residents.
Sources: Federal Reserve Survey of Unbanked Households, Bitcoin Policy Institute Research
Bitcoin has been declared "dead" over 470 times since 2010, yet it continues to grow in adoption, with a market cap now exceeding $1.5 trillion.
Strategic reserve legislation includes prudent risk management:
- Allocation caps limit exposure (typically 5-10%)
- Market cap requirements ensure only established assets
- No taxpayer funds at risk—can use seized assets, donations, or existing reserves
- Long-term holding strategy reduces volatility impact
Major institutions including BlackRock, Fidelity, and state pension funds now hold Bitcoin. Nation-states including the U.S. (federal reserve in development) are accumulating. The systemic risk of Bitcoin failing entirely has diminished substantially.
Sources: Bitcoin Obituaries, Institutional Bitcoin Holdings Data
How Other States Are Leading
See how Rhode Island compares to other states on Bitcoin and digital asset policy.
| State | Strategic Reserve | Tax Exemption | Consumer Protection | Status |
|---|---|---|---|---|
| Texas | ✓ Enacted | ◐ Pending | ✓ Yes | Leading — First state to purchase BTC ($5M) |
| New Hampshire | ✓ Enacted | ✗ No | ✓ Yes | Leading — First SBR law (HB 302) |
| Arizona | ✓ Partial | ✗ No | ✓ Yes | Active — Can hold seized crypto (HB 2749) |
| Wyoming | ✗ Failed | ✓ Yes | ✓ Yes | Established — Early crypto-friendly laws |
| Rhode Island | ◐ Proposed (H.6007) | ◐ Proposed (S.2021) | ✓ Enacted (2025) | Emerging — 8 bills under consideration |
State Success Stories
Arizona Passes Crypto Custody Law (HB 2749) ↗
Arizona updates unclaimed property laws to allow crypto assets to be held in their original form rather than liquidated, creating a pathway to maintain custody of seized Bitcoin.
New Hampshire Passes First SBR Law (HB 302) ↗
Governor Kelly Ayotte signs HB 302, allowing the state treasurer to invest up to 5% of public funds in precious metals or digital assets with market cap over $500 billion. New Hampshire becomes the first state with a Strategic Bitcoin Reserve law.
Texas Establishes Strategic Bitcoin Reserve (SB 21) ↗
Governor Greg Abbott signs SB 21 and HB 4488, creating the Texas Strategic Bitcoin Reserve with robust legal protections ensuring the reserve cannot be easily dismantled by future legislatures.
Rhode Island Blockchain Study Bill Engrossed (H.5810) ↗
Rhode Island's blockchain study commission bill reaches 50% progression before dying in chamber when session ended. Represents strong foundation for 2026 reintroduction.
Texas Makes First State Bitcoin Purchase ↗
Texas becomes the first state to purchase Bitcoin, acquiring approximately $5 million in BlackRock's iShares Bitcoin Trust (IBIT) when BTC was priced at $91,336.
Economic Impact for Rhode Island
How Bitcoin-friendly legislation could benefit our state's economy.
Business Attraction — A Critical Need
Rhode Island ranks #50 (dead last) in WalletHub's 2026 "Best States to Start a Business" report, citing high costs, limited resources, and sluggish innovation. Bitcoin-friendly policies could differentiate RI and attract blockchain companies seeking regulatory clarity—just as Wyoming's early adoption led to companies like Kraken establishing presence there.
Job Creation
The digital asset industry creates high-paying jobs in software development, compliance, legal, and financial services. These positions typically pay 20-40% above median wages and attract young talent to remain in or relocate to the state.
Tax Revenue Growth
While small transactions may be exempted, business growth generates income tax, payroll tax, and property tax revenue. New York's financial sector accounts for nearly 20% of state tax revenue—a model Rhode Island could emulate in the digital age.
Treasury Diversification
A strategic Bitcoin reserve provides hedge against inflation and currency devaluation. With proper allocation limits (5-10%), the state gains exposure to potential appreciation while managing downside risk through diversification.
Federal Context: $14 Trillion Opportunity
The Bitcoin Policy Institute projects that if 1% of federal taxes were paid in Bitcoin over 20 years (2025-2045), the U.S. could generate up to $14 trillion in cumulative value—a net advantage of ~$13 trillion compared to cash equivalents. States that position themselves early will capture a disproportionate share of this economic activity.
Read: "Digital Gold: Evaluating a Strategic Bitcoin Reserve for the United States" ↗
Take Action
How legislators and constituents can support Bitcoin-friendly policy in Rhode Island.
For Legislators
- ✓ Co-sponsor S.2021 (Tax Exemption) — Active
- ✓ Reintroduce H.5810/S.0373 (Blockchain Study)
- ✓ Reintroduce H.6007 (Strategic Reserve)
- ✓ Request briefings from RIBPI
- ✓ Visit Texas/NH to see implementation
Contact Your Representatives
Reach out to your state senators and representatives to express support for Bitcoin-friendly legislation.
Rhode Island State House
82 Smith Street, Providence, RI 02903
General Assembly
(401) 222-2466
Rhode Island Can Lead
Join Texas, New Hampshire, and Arizona in positioning your state at the forefront of financial innovation. The RI Bitcoin Policy Institute is here to help.