NC House Passes Bill Allowing Stablecoin Handling for Local Banks

The North Carolina House has approved a bill that would allow state-chartered banks and credit unions to handle stablecoins and other cryptocurrencies, while imposing strict consumer protections.

House Bill 1029, which passed with a landslide vote of 113-2, aims to keep local institutions competitive with federally chartered rivals. The bill's main sections focus on digital asset custody and staking for state-chartered banks and credit unions, as well as licensing for payment stablecoin issuers.

Under the Digital Asset Financial Act, financial institutions would need to maintain one-to-one reserves for customer assets, submit to annual audits, and notify regulators before providing fiduciary services. The bill also prohibits rehypothecation of customer assets and requires plain-English disclosures and risk notices for staking services.

The North Carolina Stablecoin Act creates a state licensing system for payment stablecoin issuers, requiring them to maintain full backing, submit monthly reserve certifications, and undergo periodic examinations by state regulators. Licensed firms would be subject to enforcement actions, including fines and criminal penalties.