- South Carolina’s new law blocks state agencies from accepting or testing any federal CBDC.
- Governor McMaster signed S. 163, protecting crypto payments, self-custody wallets, and mining.
- The law exempts mining, node operations, on-chain apps, and crypto trading from licensing rules.
South Carolina has moved further into the national digital asset debate after Governor Henry McMaster signed Senate Bill 163 into law. The measure creates a state framework for digital assets while blocking public bodies from using or testing a federally issued CBDC.
The law, titled “Cryptocurrency,” places private digital asset activity under legal protection and limits government involvement in central bank digital currency systems. It also gives users, businesses, miners, and developers clearer protections under state law.
New Law Protects Digital Asset Payments and Self-Custody
Under S. 163, individuals and businesses cannot be barred from accepting digital assets as payment for legal goods and services. The measure also protects the use of self-hosted wallets and hardware wallets, allowing users to hold their assets directly.
The law, however, prevents state and local governments from adding taxes, withholdings, assessments, or charges solely because digital assets are used for payment. That provision gives payment activity equal treatment under state rules.
It also defines several key terms, including blockchain, digital assets, mining, staking, wallets, nodes, and related activities. Those definitions form the base for how the state will treat the sector.
CBDC Restrictions Draw a Clear State Boundary
Meanwhile, the anti-CBDC section is one of the central parts of the bill. It defines a CBDC as a digital currency, exchange medium, or monetary unit issued by the Federal Reserve or another federal agency.
The law bars state agencies, boards, commissions, departments, and political subdivisions from accepting or requiring payment in a CBDC. It also blocks them from joining any test involving a similar currency issued by the Federal Reserve.
However, the definition excludes private digital assets backed by legal tender or government treasuries. That means privately issued stablecoins do not appear to fall under the restriction.
Mining and Blockchain Activity Gain Legal Protection
The legislation also shields several blockchain activities from money transmitter licensing rules. These include mining, node operations, onchain application development, and crypto-to-crypto trading.
Mining businesses receive additional protection under the new framework. Local governments cannot ban mining operations from industrial zones or impose mining-specific sound limits beyond general noise rules.
The move follows similar action in other states. In March 2025, Kentucky passed House Bill 701, protecting self-hosted wallets and limiting discriminatory rules against mining operations.
For South Carolina, the law sets a clear policy split. Private crypto use receives legal backing, while public agencies are restricted from taking part in CBDC systems.
Related: Minnesota Approves Crypto Custody Services for Banks and Credit Unions
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
