Ohio’s House of Representatives has taken a major step toward crypto adoption by passing a bill designed to promote digital asset usage and shield mining operations from government overreach.
House Bill 116, dubbed the “Ohio Blockchain Basics Act,” passed with strong bipartisan support in a 70-26 vote and now heads to the state Senate.
If approved there, it will await Governor Mike DeWine’s signature.
Earlier the same day, the bill sailed through the state’s Technology and Innovation Committee with a unanimous 13-0 vote.
Tax Exemptions for Small Crypto Transactions
A core feature of the bill is the exemption of crypto transactions under $200 from capital gains taxes.
This threshold is set to rise annually with inflation and will be rounded up to the nearest $5 based on the Consumer Price Index.
Once enacted, the bill would also prevent the tax commissioner from reducing that exemption, further ensuring stability for small crypto users.
This provision is seen as a major win for individuals using crypto for everyday purchases, as it removes the tax burden on lower-value transactions.
Push to Normalize Crypto Payments
The proposed law includes a clause that prohibits state government agencies from banning or restricting residents from accepting cryptocurrency as a form of payment.
Representative Steve Demetriou, a Republican and one of the bill’s key supporters, said the legislation has “two main focuses” — simplifying the use of crypto for payments and “protecting digital asset mining businesses from discriminatory government overreach.”
Opening the Door to Residential Crypto Mining
Under the bill, crypto mining will be permitted in residential zones as long as operators comply with local noise and zoning regulations.
For industrial zones, the bill permits mining businesses to operate freely if they meet local guidelines.
The legislation also includes protections against discriminatory zoning changes.
If local governments attempt to rezone areas in a way that adversely affects existing crypto mining businesses, the bill ensures due process is followed and gives affected miners the right to challenge such changes in court.
Clarity on Regulatory Status for Blockchain Activity
HB 116 outlines specific blockchain-related activities that will not require a money transmitter license.
These include crypto mining, staking, running blockchain nodes, crypto swaps, and software development for decentralized exchange protocols.
The bill explicitly states that these actions do not involve fiat currencies and should not be regulated as money transmission services.
It also declares that offering mining or staking services should not be classified as issuing a security or investment contract — a stance that counters federal regulators’ recent legal challenges against crypto firms.
Protecting Self-Custody Rights
In another crypto-friendly move, the bill prohibits state agencies from restricting individuals from using hardware or self-hosted wallets for digital asset custody.
This clause ensures Ohio residents maintain full control over their private keys and assets without unnecessary government interference.
Looking Ahead: Ohio Bitcoin Reserve Fund on the Table
In addition to HB 116, Ohio lawmakers are expected to debate another crypto-related initiative — the creation of an “Ohio Bitcoin Reserve Fund.”
Introduced in January, that bill is currently under review by the Financial Institutions, Insurance, and Technology Committee.
With more than 160 crypto-related bills introduced across 40 U.S. states, Ohio’s legislation is part of a wider trend among state governments seeking to define their role in the evolving digital asset economy.