South Carolina Governor Henry McMaster signed S. 163 into law on May 19, 2026, amending the state’s code of laws to establish a comprehensive framework for cryptocurrency users and businesses.
The bill passed the Senate 38–1 and cleared the House 110–1 before being ratified on May 14.
Self-custody and payment rights
Under the new law, individuals and businesses cannot be prohibited from accepting digital assets as payment for goods and services, or from using self-hosted wallets or hardware wallets to maintain self-custody of their holdings.
The legislation also bars the state and local governments from imposing any additional tax, withholding, or charge on digital asset transactions solely because a digital asset was used as the payment method, rather than U.S. legal tender.
The bill states:
“Digital assets used as a method of payment may not be subject to any additional tax, withholding, assessment, or charge by the state or a local government that is based solely on the use of the digital asset as the method of payment.”
CBDC ban
A central provision of S. 163 prohibits any state agency, board, commission, department, or political subdivision from accepting or requiring payment in central bank digital currency, or from participating in any Federal Reserve test of such a currency.
Mining protections
The law also offers significant protections for bitcoin miners.
Local governments are barred from placing restrictions on mining businesses in industrially zoned areas that do not apply to other businesses in the same zone, or from imposing sound limits beyond the area’s general noise regulations.
Mining operations, node operation, on-chain software development, and crypto-to-crypto trading are all explicitly exempt from money transmitter licensing requirements.
South Carolina joins a growing list of states enacting crypto-friendly legislation, following Kentucky, which passed a similar self-custody and mining protection bill in March 2025.
