Crypto Exchanges
By James Thorp
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Felony Charges for Non-Compliance. Non-compliance isn't just a fine situation. Brokers who don't follow the rules could face Class 3…
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Budget Pressure Drove the Decision. The state's fiscal situation is genuinely rough. Illinois has a structural budget deficit driven…
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Illinois just became the first state in the U.S. to slap a dedicated tax on cryptocurrency transactions. Governor J.B. Pritzker signed it into law as part of a $55.
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The tax sits at 0.2% and kicks in January 2027. It covers the exchange, transfer, and custody of digital assets — pretty much the full range of what crypto firms do day-to-day.
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Coinbase CEO Brian Armstrong pushed back fast.
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Armstrong and others in the space argue the tax unfairly singles out crypto while traditional Wall Street securities face no equivalent state-level charge for similar transactions.
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Non-compliance isn't just a fine situation. Brokers who don't follow the rules could face Class 3 felony charges, prison sentences of two to five years, and fines up to $25,000.
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And it's not just active traders who get hit. The tax applies to holding and transferring digital assets too, which creates real problems for anyone using decentralized finance…
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See also: Illinois Slaps a 0.2% Tax on Every Crypto Business Transaction in the State
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Illinois says the tax could bring in roughly $60 million a year. That's the number lawmakers are working with, though critics seem skeptical it'll materialize if businesses exit…
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The state's fiscal situation is genuinely rough. Illinois has a structural budget deficit driven by pension liabilities that keep growing and a tax base that's been shrinking as…
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But the timing is awkward. Illinois only recently passed the Digital Assets and Consumer Protection Act, which the crypto industry actually welcomed as a sign the state wanted…
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Industry groups have pushed Illinois to delay implementation until federal regulators land on a unified national framework.
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See also: Illinois Hits Crypto With 3% Transaction Tax, Sparking Relocation Fears
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Whether Illinois revisits the law before January 2027 is unclear. The budget is signed. The governor's office hasn't walked anything back.
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