This bill proposes the introduction of virtual-currency custody services for banking institutions and credit unions in Minnesota, allowing them to offer safekeeping, controlling, or managing of virtual currency on behalf of customers. The bill outlines specific definitions related to virtual currency and custody services, and establishes that these institutions may operate in either a fiduciary or nonfiduciary capacity. It mandates that institutions must conduct these services in a safe and sound manner, maintain written policies for risk management and compliance, and provide written notice to the commissioner at least 60 days prior to commencing such services.

Additionally, the bill emphasizes the importance of asset segregation, requiring that customer virtual currency and associated control mechanisms be legally and operationally separated from the institution's assets. It allows for the engagement of qualified third-party service providers while ensuring that the institution retains oversight responsibility. The virtual-currency custody services will be subject to examination by the commissioner as part of regular supervisory processes. The provisions of this bill will take effect on August 1, 2026, applying to services commenced on or after that date.