SPRINGFIELD — A new law from State Senator Mark Walker to eliminate fraud in the digital currency industry will help protect thousands of Illinois consumers from predatory practices.

“Investment in cryptocurrency and digital coin has grown exponentially in recent years,” said Walker (D-Arlington Heights). “This law will allow that growth to continue while creating a safer environment for consumers that invest in it.”

Crypto fraud is not unique to Illinois, but Illinois residents have faced heavy losses from fraud and scams using digital coin. According to the FBI, Illinois had the sixth most losses from crypto fraud of any state in 2023, with over 1,900 reports and $160 million in losses. The digital coin space attracts fraud because it is anonymous, making it difficult to hold fraudsters accountable.

The Digital Assets and Consumer Protection Act will limit fraud cases by requiring digital currency companies to provide disclosures to consumers and demonstrate financial fitness for payouts. Additionally, it requires companies to register with the Illinois Department of Financial and Professional Regulation and create procedures to address risks of money laundering, fraud and cybersecurity.

“Illinoisans lose hundreds of millions to crypto fraud every year,” said Walker. “While those who use digital coin currencies should still be wary of scams, I am confident that this will weed out some of the bad actors and allow consumers to feel a stronger sense of confidence.”

“SB1797 modernizes consumer protections and ensures safeguards protect all Illinoisans who choose digital asset financial services,” said IDFPR Secretary Mario Treto, Jr. “This is a monumental victory that prioritizes the financial safety and security of the people of Illinois, while also paving the way for a more transparent and accessible digital asset marketplace.”

Senate Bill 1797 was signed into law on Monday and takes effect immediately.