South Carolina Enacts Digital Assets Law on CBDCs, Mining, Wallets

South Carolina Governor Henry McMaster signed Senate Bill 163 into law on Tuesday, establishing a comprehensive regulatory framework for digital assets that restricts state involvement with central bank digital currencies and provides legal protections for cryptocurrency users and businesses.

The new law prohibits any state agency, commission, department, or political subdivision from accepting or requiring payment in a central bank digital currency (CBDC). It also bars state entities from participating in any Federal Reserve-led digital currency pilot programs. For individuals and businesses, the legislation guarantees the right to accept digital assets as payment for goods and services and protects the use of self-hosted and hardware wallets for asset custody. It further prevents state and local governments from imposing higher taxes, fees, or assessments on cryptocurrency transactions than those applied to comparable payments made in U.S. dollars.

A significant portion of the law focuses on cryptocurrency mining operations. It stipulates that local governments cannot impose mining-specific restrictions on businesses operating in industrial zones that do not equally apply to...