HB5303 104TH GENERAL ASSEMBLY

LRB104 19433 BAB 32881 b

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
HB5303

Introduced 2/10/2026, by Rep. Natalie A. Manley

SYNOPSIS AS INTRODUCED:

205 ILCS 731/1-5
205 ILCS 731/1-10
205 ILCS 731/15-10
205 ILCS 731/15-15
205 ILCS 731/20-25
205 ILCS 731/20-45
205 ILCS 731/35-15

Amends the Digital Assets and Consumer Protection Act. Makes changes to defined terms. Provides that the Act does not apply to a person whose digital financial asset business activity with, or on behalf of, residents is reasonably expected to be valued, in the aggregate, on an annual basis at $5,000,000 or less, measured by the United States dollar equivalent of digital financial assets. Requires the Department of Financial and Professional Regulation to approve, conditionally approve, or deny any license application within 120 days after receipt of a completed application. Replaces provisions concerning renewal applications with annual reporting requirement provisions. Provides that the transition period under which covered persons and covered exchanges are not considered in violation of certain provisions ends January 1, 2028 (instead of January 1, 2027). Provides that rules adopted under the Act do not take effect earlier than January 1, 2027 (instead of January 1, 2026). Effective immediately.

A BILL FOR

AN ACT concerning regulation.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Digital Assets and Consumer Protection Act is amended by changing Sections 1-5, 1-10, 15-10, 15-15, 20-25, 20-45, and 35-15 as follows:

(205 ILCS 731/1-5)

Sec. 1-5. Definitions.

(a) As used in this Act:

"Affiliate" means any person that controls, is controlled by, or is under common control with another person. For purposes of this definition, "control" means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person.

"Applicant" means a person that applies for registration under this Act.

"Bank" means a bank, savings banks, savings and loan association, savings association, or industrial loan company chartered under the laws of this State or any other state or under the laws of the United States.

"Confidential supervisory information" means information or documents obtained by employees, agents, or representatives of the Department in the course of any examination, investigation, audit, visit, registration, certification, review, licensing, or any other regulatory or supervisory activity pursuant to this Act, and any record prepared or obtained by the Department to the extent that the record summarizes or contains information derived from any report, document, or record described in this Act.

"Conflict of interest" means an interest that might incline a covered person or an individual who is an associated person of a covered person to make a recommendation that is not disinterested.

"Corporate fiduciary" shall mean a corporate fiduciary as defined by Section 1-5.05 of the Corporate Fiduciary Act.

"Covered person" means a registrant or person required to register pursuant to this Act.

"Covered exchange" means a covered person that exchanges or holds itself out as being able to exchange a digital asset for a resident as part of a business or on behalf of a customer who has entered into an agreement with a business for the provision of such services.

"Credit union" means a credit union chartered under the laws of this State or any other state or under the laws of the United States.

"Department" means the Department of Financial and Professional Regulation.

"Digital asset" means a digital representation of value that is used as a medium of exchange, unit of account, or store of value, and that is not fiat currency, whether or not denominated in fiat currency. "Digital asset" does not include any of the following:

(1) A digital representation of value that a merchant grants as part of an affinity or rewards program and that primarily relates to such affinity or rewards program.

(2) A digital representation of value that is issued by or on behalf of a game publisher and that is used primarily within online games or gaming platforms.

(3) Other digital representations of value that have substantial value, utility, or significance beyond the asset's mere existence as a digital asset, including digital equivalents of tangible and intangible goods such as: (A) works of art, musical compositions, literary works, and similar intellectual property; (B) collectibles and merchandise; and (C) licenses, tickets, and similar rights to attend events or participate in activities.

(4) A digital representation of value that is not marketed, used, promoted, offered, or sold for investment or speculation, except that this exclusion shall not apply to any digital representation of value that (A) is meme-based with no intrinsic value or utility or (B) is marketed, used, promoted, offered, or sold in a manner that intends to establish a reasonable expectation or belief among the general public that the instrument will retain a nominal value that is so stable as to render the nominal value effectively fixed. The Department may adopt rules to clarify the scope and applicability of this subsection.

(5) A digital representation of value that is used as part of prepaid cards.

"Digital asset business activity" means any of the following:

(1) Exchanging, transferring, or storing a digital asset as part of a business or on behalf of a customer who has entered into an agreement with a business for the provision of such services.

(2) Engaging in digital asset administration.

(3) Any other business activity involving digital assets designated by rule by the Department as may be necessary and appropriate for the protection of residents.

"Digital asset business activity" does not include (1) peer-to-peer exchanges or transfers of digital assets, (2) decentralized exchanges facilitating peer-to-peer exchanges or transfers solely through use of a computer program or a transaction protocol that is intended to automatically execute, control, or document events and actions, (3) the development, publication, constitution, administration, maintenance, and dissemination of software in and of itself, (4) the issuance of a non-fungible token in and of itself, and (5) validating a digital asset transaction, operating a node, or engaging in similar activity to participate in facilitating, operating, or securing a blockchain system, and (6) any money transmission of legal tender occurring in, associated with, or related to the normal, typical, or customary performance of digital asset business activity. For purposes of this definition, "legal tender" means a medium of exchange or unit of value, including the coin or paper money of the United States, issued by the United States or by another government.

"Exchange", when used as a verb, means to exchange, buy, sell, trade, or convert, on behalf of a resident, either of the following:

(1) A digital asset for fiat currency or one or more forms of digital assets.

(2) Fiat currency for one or more forms of digital assets.

"Exchange" does not include buying, selling, or trading digital assets for a person's own account in a principal capacity.

"Executive officer" includes, without limitation, an individual who is a director, officer, manager, managing member, partner, or trustee, or other functionally equivalent responsible individual, of a person.

"Federally insured depository institution" shall mean an insured depository institution as defined by Section 3(c)(2) of the Federal Deposit Insurance Act, 12 U.S.C. 1813(c)(2), as amended, or an insured credit union as defined by Section 101(7) of the Federal Credit Union Act, 12 U.S.C. 1752(7), as amended.

"Fiat currency" means a medium of exchange or unit of value issued by the United States or a foreign government and that is designated as legal tender in its country of issuance.

"Insolvent" means any of the following:

(1) Having generally ceased to pay debts in the ordinary course of business other than as a result of a bona fide dispute.

(2) Being unable to pay debts as they become due.

(3) Being insolvent within the meaning of federal bankruptcy law.

"Non-fungible token" means any unique digital identifier on any blockchain or digital asset network used to certify authenticity and ownership rights that is not readily exchangeable or replaceable with a mutually interchangeable digital asset of the same value. The Department may modify this definition by rule.

"Person" includes, without limitation, any individual, corporation, business trust, estate, trust, partnership, proprietorship, syndicate, limited liability company, association, joint venture, government, governmental subsection, agency or instrumentality, public corporation or joint stock company, or any other organization or legal or commercial entity.

"Prepaid card" means an electronic payment device that, subject to any rules adopted by the Department:

(1) is usable at a single merchant or an affiliated group of merchants that share the same name, mark, or logo, or is usable at multiple, unaffiliated merchants or service providers;

(2) is issued in and for a specified amount of fiat currency;

(3) can be reloaded in and for only fiat currency, if at all;

(4) is issued or reloaded on a prepaid basis for the future purchase or delivery of goods or services;

(5) is honored upon presentation;

(6) can be redeemed in and for only fiat currency, if at all;

(7) is governed by the Uniform Money Transmission Modernization Act; and

(8) complies with any other condition designated by rule by the Department as may be necessary and appropriate for the protection of residents.

"Qualified custodian" means a bank, credit union, or trust company, subject to any rules adopted by the Department.

"Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

"Registrant" means a person registered under this Act.

"Resident" means any of the following:

(1) A person who is domiciled in this State.

(2) A person who is physically located in this State for more than 183 days of the previous 365 days.

(3) A person who has a place of business in this State.

(4) A legal representative of a person that is domiciled in this State.

"Request for assistance" means all inquiries, complaints, account disputes, and requests for documentation a covered person receives from residents.

"Responsible individual" means an individual who has direct control over, or significant management, policy, or decision-making authority with respect to, a person's digital asset business activity in this State.

"Secretary" means the Secretary of Financial and Professional Regulation and any authorized representative of the Secretary.

"Service provider" means any person that provides a material service to a covered person in connection with the offering or provision by that covered person of a digital asset business activity in this State, including a person that either:

(1) Participates in designing, operating, or maintaining the digital asset business activity.

(2) Processes transactions relating to the digital asset business activity, other than unknowingly or incidentally transmitting or processing financial data in a manner that the data is undifferentiated from other types of data of the same form as the person transmits or processes.

"State" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States.

"Store,", "storage", and "storing", except in the phrase "store of value,", mean means to store, hold, or maintain custody or control of a digital asset on behalf of a resident by a person other than the resident.

"Transfer" means to transfer or transmit a digital asset on behalf of a resident, including by doing any of the following:

(1) Crediting the digital asset to the account or storage of another person.

(2) Moving the digital asset from one account or storage of a resident to another account or storage of the same resident.

(3) Relinquishing custody or control of a digital asset to another person.

"United States dollar equivalent of digital assets" means the equivalent value of a particular digital asset in United States dollars shown on a covered exchange regulated in the United States for a particular date or period specified in this Act, subject to any rules adopted by the Department.

(b) Whenever the terms "include", "including" or terms of similar import appear in this Act, unless the context requires otherwise, such terms shall not be construed to imply the exclusion of any person, class, or thing not specifically included.

(c) A reference in this Act to any other law or statute of this State, or of any other jurisdiction, means such law or statute as amended to the effective date of this Act, and unless the context otherwise requires, as amended thereafter.

(d) Any reference to this Act shall include any rules adopted in accordance with this Act.

(Source: P.A. 104-428, eff. 8-18-25; revised 12-12-25.)

(205 ILCS 731/1-10)

Sec. 1-10. Applicability.

(a) This Act governs the digital asset business activity of a person doing business in this State or, wherever located, who engages in or holds itself out as engaging in the activity with or on behalf of a resident, to the extent not preempted by federal law and except as otherwise provided in subsection subsections (b), (c), (d), or (e).

(b)(1) This Act does not apply to the exchange, transfer, or storage of a digital asset or to digital asset administration to the extent that:

(A) the Securities Exchange Act of 1934, 15 U.S.C. 78a et seq., or the Illinois Securities Law of 1953 govern the activity as a security transaction and the activity is regulated by the U.S. Securities and Exchange Commission or the Illinois Secretary of State; or

(B) the Commodity Exchange Act, 7 U.S.C. 1 et seq., governs the activity, the activity is in connection with trading of a contract of sale of a commodity for future delivery, an option on such a contract or a swap, and the activity is regulated by the U.S. Commodity Futures Trading Commission.

(2) This subsection shall be construed in a manner consistent with affording the greatest protection to residents and the Department's authority under subsection (a) of Section 1-15 to exercise nonexclusive oversight and enforcement under any federal law applicable to digital asset business activity. This subsection shall not be construed to exempt an activity solely because a financial regulatory agency has anti-fraud and anti-manipulation enforcement authority over the activity.

(c) This Act does not apply to the following persons:

(1) The United States, a state State, political subdivision of a state State, agency, or instrumentality of federal, state State, or local government, or a foreign government or a subdivision, department, agency, or instrumentality of a foreign government.

(2) A federally insured depository institution.

(3) A corporate fiduciary acting as a fiduciary or otherwise engaging in fiduciary activities.

(4) A merchant using digital assets solely for the purchase or sale of goods or services, excluding the sale or of purchase of digital assets, in the ordinary course of its business.

(5) A person using digital assets solely for the purchase or sale of goods or services for his or her own personal, family, or household purposes.

(6) A person who (A) contributes connectivity software or computing power or otherwise participates in the process of securing a network, (B) records digital asset transactions to the network or protocol governing transfer of the digital representation of value, or (C) develops, publishes, constitutes, administers, maintains, or otherwise distributes software relating to the network, so long as the person does not control transactions of digital assets on the network.

(7) A credit union with member share accounts insured by an insurer approved by the credit union's primary financial regulatory agency. An out-of-state credit union may not conduct any activity in this State that is not authorized for a credit union chartered under the laws of this State.

(8) A person whose digital financial asset business activity with, or on behalf of, residents is reasonably expected to be valued, in the aggregate, on an annual basis at $5,000,000 or less, measured by the United States dollar equivalent of digital financial assets.

Nothing in this Act grants persons described in this subsection (c) authority to engage in any activity not otherwise granted under existing law.

(d) The Department may by rule or order clarify whether an activity is governed under this Act or another Act that governs money transmission. This subsection (d) shall not be applied in a manner inconsistent with the protection of residents.

(e) Notwithstanding any other provision of this Act, the Department, by rule or order, may conditionally or unconditionally exempt any person, digital asset, or transaction, or any class or classes of persons, digital assets, or transactions, from any provision of this Act or of any rule thereunder, to the extent that the exemption is necessary or appropriate, in the public interest, and consistent with the protection of residents.

(Source: P.A. 104-428, eff. 8-18-25; revised 12-12-25.)

(205 ILCS 731/15-10)

Sec. 15-10. Application.

(a) An application for a registration under this Act shall meet all of the following requirements:

(1) The application shall be in a form and medium prescribed by the Department. The Department may require the filing of the application through a multistate licensing system.

(2) The application shall provide all of the following information relevant to the applicant's proposed digital asset business activity:

(A) The legal name of the applicant, any current or proposed business United States Postal Service address of the applicant, and any fictitious or trade name the applicant uses or plans to use in conducting the applicant's digital asset business activity with or on behalf of a resident.

(B) The legal name, any former or fictitious name, and the residential and business United States Postal Service address of any executive officer and responsible individual of the applicant and any person that has control of the applicant.

(C) A description of the current and former business of the applicant and any affiliate of the applicant for the 5 years before the application is submitted, or, if the business has operated for less than 5 years, for the time the business has operated, including its products and services, associated internet website addresses and social media pages, principal place of business, projected user base, and specific marketing targets.

(D) A list of all of the following:

(i) Any digital asset, money service, or money transmitter registration the applicant and any affiliates hold in another state or from an agency of the United States.

(ii) The date the registrations described in subdivision (i) expire.

(iii) Any revocation, suspension, or other disciplinary action taken against the applicant and any affiliates in any state or by an agency of the United States and any applications rejected by any state or agency of the United States.

(E) A list of any criminal conviction, deferred prosecution agreement, and pending criminal proceeding in any jurisdiction against all of the following:

(i) The applicant.

(ii) Any executive officer of the applicant.

(iii) Any responsible individual of the applicant.

(iv) Any person that has control over the applicant.

(v) Any affiliate of the applicant.

(F) A list of any litigation, arbitration, or administrative proceeding in any jurisdiction in which the applicant or an executive officer, responsible individual, or affiliate of the applicant has been a party for the 10 years before the application is submitted determined to be material in accordance with generally accepted accounting principles and, to the extent the applicant or such other person would be required to disclose the litigation, arbitration, or administrative proceeding in the applicant's or such other person's audited financial statements, reports to equity owners, and similar statements or reports.

(G) A list of any bankruptcy or receivership proceeding in any jurisdiction for the 10 years before the application is submitted in which any of the following was a debtor:

(i) The applicant.

(ii) An executive officer of the applicant.

(iii) A responsible individual of the applicant.

(iv) A person that has control over the applicant.

(v) An affiliate of the applicant.

(H) The name and United States Postal Service address of any bank or credit union in which the applicant and any affiliates plan to deposit funds obtained by digital asset business activity.

(I) The source of funds and credit to be used by the applicant and any affiliate to conduct digital asset business activity with or on behalf of a resident.

(J) A current financial statement and other documentation satisfactory to the Department demonstrating that the applicant has the capital and liquidity required by Section 20-5.

(K) The United States Postal Service address and email address to which communications from the Department can be sent.

(L) The name, United States Postal Service address, and email address of the registered agent of the applicant in this State.

(M) A copy of the certificate, or a detailed summary acceptable to the Department, of coverage for any liability, casualty, business interruption, or cybersecurity insurance policy maintained by the applicant for itself, an executive officer, a responsible individual, an affiliate, or the applicant's users.

(N) If applicable, the date on which and the state in which the applicant is formed and a copy of a current certificate of good standing issued by that state.

(O) If a person has control of the applicant and the person's equity interests are publicly traded in the United States, a copy of the audited financial statement of the person for the most recent fiscal year or most recent report of the person filed under Section 13 of the Securities Exchange Act of 1934, 15 U.S.C. 78m.

(P) If a person has control of the applicant and the person's equity interests are publicly traded outside the United States, a copy of the audited financial statement of the person for the most recent fiscal year of the person or a copy of the most recent documentation similar to that required in subparagraph (O) filed with the foreign regulator in the domicile of the person.

(Q) If the applicant is a partnership or a member-managed limited liability company, the names and United States Postal Service addresses of any general partner or member.

(R) If the applicant is required to register with the Financial Crimes Enforcement Network of the United States Department of the Treasury as a money service business, evidence of the registration.

(S) A set of fingerprints for each executive officer and responsible individual of the applicant.

(T) If available, for any executive officer and responsible individual of the applicant, for the 10 years before the application is submitted, employment history and history of any investigation of the individual or legal proceeding to which the individual was a party.

(U) The plans through which the applicant will meet its obligations under Article 10.

(V) Any other information the Department requires by rule.

(3) The application shall be accompanied by a nonrefundable fee of $5,000 or the amount determined by the Department to cover the costs of application review, whichever is greater.

(b)(1) On receipt of a completed application, the Department shall investigate all of the following:

(A) The financial condition and responsibility of the applicant and any affiliate of the applicant.

(B) The relevant financial and business experience, character, and general fitness of the applicant and any affiliate of the applicant.

(C) The competence, experience, character, and general fitness of each executive officer and director, each responsible individual, and any person that has control of the applicant.

(2) On receipt of a completed application, the Department may investigate the business premises of an applicant or an affiliate of the applicant or require the submission of any other documents or information the Department deems relevant to the application.

(3) The investigation required by this subsection must allow the Secretary to issue positive findings stating that the financial condition, financial responsibility, competence, experience, character, and general fitness of the applicant, each executive officer and director, each responsible individual, any person that has control of the applicant, and any affiliate of the applicant are such as to command the confidence of the community and to warrant belief that the business will be operated honestly, fairly, and efficiently within the purpose of this Act; if the Secretary does not so find, he or she shall not issue the registration, and he or she shall notify the applicant of the denial.

(c)(1) After completing the investigation required by subsection (b), the Department shall send the applicant notice of its decision to approve, conditionally approve, or deny the application. If the Department does not receive notice from the applicant that the applicant accepts conditions specified by the Department within 31 days following the Department's notice of the conditions, the application shall be deemed withdrawn. The Department shall approve, conditionally approve, or deny any license application within 120 days after receipt of a completed application.

(2) The Secretary may impose conditions on a registration if the Secretary determines that those conditions are necessary or appropriate. These conditions shall be imposed in writing and shall continue in effect for the period prescribed by the Secretary.

(d) A registration issued pursuant to this Act shall take effect on the later of the following:

(1) The date the Department issues the registration.

(2) The date the registration provides the security required by Section 20-5.

(e) In addition to the fee required by paragraph (3) of subsection (a), an applicant shall pay the costs of the Department's investigation under subsection (b).

(f) A registration issued pursuant to this Act shall remain in full force and effect until it expires without meeting the reporting requirements of this Act renewal, is surrendered by the registration, or revoked or suspended as hereinafter provided.

(g)(1) The Department may issue a conditional registration to an applicant who holds or maintains a registration to conduct virtual currency business activity in the State of New York pursuant to Part 200 of Title 23 of the New York Code of Rules and Regulations, or a charter as a New York State limited purpose trust company with approval to conduct virtual currency business under the New York Banking Law, if the registration or approval was issued no later than the effective date of this Act and the applicant pays all appropriate fees and complies with the requirements of this Act.

(2) A conditional registration issued pursuant to this subsection shall expire at the earliest of the following:

(A) upon issuance of an unconditional registration;

(B) upon denial of a registration;

(C) upon revocation of a registration issued pursuant to Part 200 of Title 23 of the New York Code of Rules and Regulations or disapproval or revocation of a charter as a New York State limited purpose trust company with approval to conduct virtual currency business under the New York Banking Law.

(Source: P.A. 104-428, eff. 8-18-25.)

(205 ILCS 731/15-15)

Sec. 15-15. Annual report Renewal.

(a) Registrations shall be subject to reporting requirements renewal every year using a common reporting renewal period as established by the Department by rule. A registrant shall submit to the Department an annual report may apply for renewal of the registration by submitting a renewal application under subsection (b) and pay paying all applicable fees due to the Department.

(b) The report renewal application required by subsection (a) shall be submitted in a form and medium prescribed by the Department. The report application shall contain all of the following:

(1) Either a copy of the registrant's most recent reviewed annual financial statement, if the gross revenue generated by the registrant's digital asset business activity in this State was not more than $2,000,000 for the fiscal year ending before the anniversary date of issuance of its registration under this Act, or a copy of the registrant's most recent audited annual financial statement, if the registrant's digital asset business activity in this State amounted to more than $2,000,000, for the fiscal year ending before the anniversary date.

(2) If a person other than an individual has control of the registrant, a copy of either of the following:

(A) The person's most recent reviewed annual financial statement, if the person's gross revenue was not more than $2,000,000 in the previous fiscal year measured as of the anniversary date of issuance of its registration under this Act.

(B) The person's most recent audited consolidated annual financial statement, if the person's gross revenue was more than $2,000,000 in the previous fiscal year measured as of the anniversary date of issuance of its registration under this Act.

(3) A description of any of the following:

(A) Any material change in the financial condition of the registrant and any affiliate of the registrant.

(B) Any material litigation related to the registrant's digital asset business activity and involving the registrant or an executive officer, responsible individual, or affiliate of the registrant.

(C) Any federal, state, or foreign investigation involving the registrant or an executive officer, responsible individual, or affiliate of the registrant.

(D)(i) Any data security breach or cybersecurity event involving the registrant.

(ii) A description of a data security breach pursuant to this subparagraph does not constitute disclosure or notification of a security breach for purposes of any other law.

(4) Information or records required by Section 20-25 that the registrant has not reported to the Department.

(5) The number of digital asset business activity transactions with or on behalf of residents for the period since the later of the date the registration was issued or the date the last report renewal application was submitted.

(6)(A) The amount of United States dollar equivalent of digital assets in the custody or control of the registrant at the end of the last month that ends not later than 30 days before the date of the report renewal application.

(B) The total number of residents for whom the registrant had custody or control of United States dollar equivalent of digital assets on that date.

(7) Evidence that the registrant is in compliance with Section 5-10.

(8) Evidence that the registrant is in compliance with Section 20-5.

(9) A list of all locations where the registrant engages in digital asset business activity.

(10) Any other information the Department requires by rule.

(c) If a registrant does not timely comply with this Section, the Department may take enforcement actions provided under Section 20-50. Notice or hearing is not required for a suspension or revocation of a registration under this Act for failure to pay a reporting renewal fee, file a report renewal application, or otherwise comply with this Section.

(d) Suspension or revocation of a registration under this Section does not invalidate a transfer or exchange of digital assets for or on behalf of a resident made during the suspension or revocation and does not insulate the registrant from liability under this Act.

(e) For good cause, the Department, in its sole discretion, may extend a period under this Section.

(f) A registrant that does not comply with this Section shall cease digital asset business activities with or on behalf of a resident. A registrant ceasing an activity or activities regulated by this Act and desiring to no longer be registered shall so inform the Department in writing and, at the same time, convey any registration issued and all other symbols or indicia of registration. The registrant shall include a plan for the withdrawal from regulated business, including a timetable for the disposition of the business, and comply with the surrender guidelines or requirements of the Department.

(Source: P.A. 104-428, eff. 8-18-25.)

(205 ILCS 731/20-25)

Sec. 20-25. Material business changes.

(a) A registrant shall file with the Department a report of the following, as may be applicable:

(1) A material change in information in the application for a registration under this Act or the most recent renewal report of the registrant under this Act.

(2) A material change in the registrant's business for the conduct of its digital asset business activity with or on behalf of a resident.

(3) A change of an affiliate, executive officer, responsible individual, or person in control of the registrant.

(b) A report required by this Section shall be filed not later than 15 days after the change described in subsection (a).

(Source: P.A. 104-428, eff. 8-18-25.)

(205 ILCS 731/20-45)

Sec. 20-45. Additional investigation and examination authority. In addition to any authority allowed under this Act or other applicable law, the Secretary shall have the authority to conduct investigations and examinations as follows:

(1) For purposes of initial registration, reporting renewal, suspension, conditioning, revocation or termination, or general or specific inquiry or investigation to determine compliance with this Act, the Secretary shall have the authority to access, receive, and use any books, accounts, records, files, documents, information, or evidence, including, but not limited to, the following:

(A) criminal, civil, and administrative history information, including nonconviction data as specified in the Criminal Code of 2012;

(B) personal history and experience information, including independent credit reports obtained from a consumer reporting agency described in Section 603(p) of the federal Fair Credit Reporting Act; and

(C) any other documents, information, or evidence the Secretary deems relevant to the inquiry or investigation, regardless of the location, possession, control, or custody of the documents, information, or evidence.

(2) For the purposes of investigating violations or complaints arising under this Act or for the purposes of examination, the Secretary may review, investigate, or examine any covered person, affiliate, service provider, individual, or person subject to this Act as often as necessary in order to carry out the purposes of this Act. The Secretary may direct, subpoena, or order the attendance of and examine under oath all persons whose testimony may be required about the transactions or the business or subject matter of any such examination or investigation, and may direct, subpoena, or order the person to produce books, accounts, records, files, and any other documents the Secretary deems relevant to the inquiry.

(3) Each covered person, affiliate, service provider, individual, or person subject to this Act shall make available to the Secretary upon request the books and records relating to the operations of the registrant, affiliate, individual, or person subject to this Act. The Secretary shall have access to those books and records and interview the officers, principals, employees, independent contractors, agents, and customers of the covered person, affiliate, service provider, individual, or person subject to this Act concerning their business.

(4) Each covered person, affiliate, service provider, individual, or person subject to this Act shall make or compile reports or prepare other information as directed by the Secretary in order to carry out the purposes of this Section, including, but not limited to:

(A) accounting compilations;

(B) information lists and data concerning transactions in a format prescribed by the Secretary; or

(C) other information deemed necessary to carry out the purposes of this Section.

(5) In making any examination or investigation authorized by this Act, the Secretary may control access to any documents and records of the covered person or person under examination or investigation. The Secretary may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no person shall remove or attempt to remove any of the documents or records, except pursuant to a court order or with the consent of the Secretary. Unless the Secretary has reasonable grounds to believe the documents or records of the covered person or person under examination or investigation have been or are at risk of being altered or destroyed for purposes of concealing a violation of this Act, the covered person or owner of the documents and records shall have access to the documents or records as necessary to conduct its ordinary business affairs.

(6) In order to carry out the purposes of this Section, the Secretary may:

(A) retain attorneys, accountants, or other professionals and specialists as examiners, auditors, or investigators to conduct or assist in the conduct of examinations or investigations;

(B) enter into agreements or relationships with other government officials, regulatory associations, or self-regulatory organizations in order to improve efficiencies and reduce regulatory burden by sharing resources, standardized or uniform methods or procedures, and documents, records, information, or evidence obtained under this Section;

(C) use, hire, contract, or employ public or privately available analytical systems, methods, or software to examine or investigate the covered person, affiliate, service provider, individual, or person subject to this Act;

(D) accept and rely on examination or investigation reports made by other government officials, within or outside this State; or

(E) accept audit reports made by an independent certified public accountant for the covered person, affiliate, service provider, individual, or person subject to this Act in the course of that part of the examination covering the same general subject matter as the audit and may incorporate the audit report in the report of the examination, report of investigation, or other writing of the Secretary.

(7) The authority of this Section shall remain in effect, whether such a covered person, affiliate, service provider, individual, or person subject to this Act acts or claims to act under any licensing or registration law of this State or claims to act without the authority.

(8) No covered person, affiliate, service provider, individual, or person subject to investigation or examination under this Section may knowingly withhold, abstract, remove, mutilate, destroy, or secrete any books, records, computer records, or other information.

(Source: P.A. 104-428, eff. 8-18-25.)

(205 ILCS 731/35-15)

Sec. 35-15. Transition period.

(a) A covered person engaging in digital asset business activity without a registration under this Act shall not be considered in violation of Section 15-5 or 5-25 until July 1, 2028 2027.

(b) A covered person engaging in digital asset business activity shall not be considered in violation of Sections 5-5, 5-10, and 5-20 until January 1, 2028 2027.

(c) A covered exchange shall not be considered in violation of Section 5-15 until January 1, 2028 2027.

(d) Notwithstanding the foregoing, the Department may adopt rules pursuant to this Act upon this Act becoming law with such rules not to take effect earlier than January 1, 2027 2026.".

(Source: P.A. 104-428, eff. 8-18-25; revised 12-12-25.)

Section 99. Effective date. This Act takes effect upon becoming law.