Wall Street · CoinDesk
Walz separately signed a bipartisan bill (SF 3868) implementing a statewide ban on the ATMs effective August 1
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Minnesota financial institutions can no longer afford to remain on the sidelines as Wall Street aggressively captures digital asset infrastructure, driving a state-level legislative push to halt deposit flight and insulate the local economy, a local legislator and a banker told CoinDesk.
Key facts
- Walz separately signed a bipartisan bill (SF 3868) implementing a statewide ban on the ATMs effective August 1
- From the state’s bankers’ perspective, the issue is also about remaining competitive, Meggan Schwirtz, chief experience officer at St. Cloud Financial Credit Union, told CoinDesk
- The new law was signed by Governor Tim Walz last week and is scheduled to come into full force on Aug. 1, after passing with overwhelming bipartisan support in the legislature earlier this month
- Ryan Smith, chief Advocacy Officer at Minnesota Credit Union Network, said that while the passage of the law is vital, it is not the last word on crypto custody regulation
Summary
Minnesota has enacted a first-of-its-kind Midwestern law allowing state-chartered banks and credit unions to offer cryptocurrency custody services, aiming to stem deposit flight to out-of-state crypto platforms. Lawmakers and local bankers say the measure is needed to keep community institutions competitive as Wall Street accelerates its push into digital asset infrastructure, stablecoins and tokenization. The law, which takes effect Aug. 1, 2026, comes alongside a statewide ban on crypto ATMs and kiosks and will require institutions offering custody to meet strict federal compliance standards without the protection of federal deposit insurance.