Indiana Bill Seeks Bitcoin ETF Options in Public Pensions and Statewide Protections for Crypto Use

Indiana is moving to standardize crypto access and rules. Rep. Kyle Pierce (R) introduced House Bill 2014, a proposal that would require state-managed retirement and savings programs for public servants to include exchange-traded funds that provide cryptocurrency exposure. The bill also preempts local governments from imposing rules that “unreasonably” restrict using digital assets for payments, operating miners, or holding coins in self-custody. It was sent to the House Financial Institutions Committee as Indiana’s 2026 legislative session kicked off early this week due to redistricting. Pierce, elected in 2022, framed the effort as expanding investment choice with clear guardrails.

The pension menu mandate is the hinge point. In many states, crypto access for public employees sits behind brokerage windows or supplemental plans. HB 2014 flips the default: it doesn’t compel anyone to buy Bitcoin, but it compels plan sponsors to make at least one crypto-exposure ETF available. That subtle shift matters. When an asset class is present on a plan menu, participation typically rises because the perceived diligence hurdle is lower. Yet fiduciary duty doesn’t disappear. Plan administrators will still need a defensible process for selecting and monitoring products—fees, liquidity, tracking, spread behavior around volatility spikes, and custody arrangements all matter. The requirement to offer “ETFs with cryptocurrency exposure” will likely push sponsors toward SEC-registered, exchange-traded vehicles rather than bespoke trusts, but decisions between spot, futures-based, or diversified crypto baskets introduce different risk profiles and potential basis or premium dynamics that participants may not appreciate without robust disclosures.

The bill’s preemption clause is equally consequential. By banning “unreasonable” local restrictions on crypto payments, mining, and self-custody, Indiana would set a uniform statewide baseline. That protects industrial-zoned mining from blanket local vetoes and explicitly allows residential mining in areas zoned for housing, while still leaving room for neutral standards on noise, energy safety, and grid interconnection. Expect the word “unreasonable” to do heavy lifting—cities can likely regulate externalities, but broad prohibitions would face a higher bar. Payments policy would be harmonized too: municipalities couldn’t single out crypto acceptance with punitive rules, though federal securities, commodities, tax, and money transmission laws still apply. Notably, the bill also directs the state to evaluate government use cases for crypto and opens the door to pilots, balancing experimentation with oversight.

Indiana’s approach diverges from states that authorized direct government balance-sheet allocations to digital assets (for example, New Hampshire) or those exploring transaction taxes to fund public health initiatives. It also arrives in a year when several state proposals echoed elements of a federal Bitcoin “strategic reserve” announced by President Donald Trump in March, with New Hampshire, Texas, and Arizona among those adopting related measures. Indiana is choosing a lighter-touch path: empower individuals via pensions and standardize market access, rather than put the state’s own capital at risk.

The practical challenge is behavioral and operational, not ideological. Volatility can lure or scare participants at the wrong times; menu design, education, and clear risk tiers will do more to protect savers than paternalism disguised as scarcity. From an operational standpoint, selecting ETF vehicles with transparent creation-redemption, credible custodians, and resilient market-making is paramount to avoid tracking error and liquidity gaps during stress. On the policy side, statewide preemption should curb fragmented local rules while still respecting legitimate zoning and safety objectives. That balance—choice without chaos—will determine whether HB 2014 expands opportunity or simply migrates risk. If Indiana can thread that needle, it sets a pragmatic template for other states debating crypto in public pensions and everyday commerce.