Indiana Senate Committee Advances Bill to Allow Crypto ETFs in Public Retirement Plans

• Indiana advances a bill that allows public workers to invest retirement funds in regulated crypto ETFs.

• The proposal blocks stablecoin funds and focuses only on exchange traded crypto products.

• Lawmakers aim to expand retirement choice while keeping state oversight and uniform crypto rules.

On February 13, Indiana lawmakers advanced House Bill 1042 and brought cryptocurrency a step closer to the public retirement plans. The bill was passed by a Senate committee and was sent to the entire Senate. The measure will be discussed and voted by lawmakers. The proposal would allow public employees to access crypto investments inside state-managed retirement plans. The Indiana Public Retirement System oversees about $55 billion in assets.

BREAKING: Indiana advances bill to allow state retirement funds to invest in crypto ETFs pic.twitter.com/0xL2logsIr

— Crypto Sum (@cryptosum_) February 13, 2026

The bill focuses on giving workers more control over their retirement choices. It does not require the state to purchase digital assets. Instead, employees would decide whether to include crypto in their portfolios. Lawmakers designed the structure to keep responsibility with individual account holders. At the same time, the state would maintain oversight of the retirement framework.

Senate Advances Crypto Retirement Measure

Under the proposal, employees could open self-directed brokerage accounts starting July 1. These accounts would allow workers to invest part of their savings in approved crypto products. Retirement administrators would continue supervising the broader system. They would apply existing compliance standards and reporting rules. This setup combines flexibility with supervision.

The bill also creates consistent crypto rules across Indiana. It prevents the ability of the local governments to forbid legal crypto payments, custody services, or mining activities. Lawmakers desire to avoid the clashing policies of cities and counties. Consequently, the businesses and the residents would adopt similar statewide standards. Supporters believe this clarity could reduce uncertainty for digital asset companies.

Structured Access Through Regulated Products

House Bill 1042 limits the types of crypto exposure available in retirement plans. Pension funds could invest in cryptocurrency exchange-traded funds. However, the bill excludes funds that focus on stablecoins. Lawmakers want retirement exposure tied to market-traded crypto products. They aim to avoid direct links to dollar-pegged tokens.

This ETF structure allows workers to gain exposure without holding crypto directly. It reduces custody concerns while keeping investments inside regulated markets. Lawmakers introduced the bill in December to prepare for growing digital asset adoption. They continue to frame it as a cautious expansion of investment options.

Indiana Joins Broader State Trend

Several other states have explored similar proposals. New Hampshire, Texas, North Carolina, and Oklahoma have reviewed crypto access in public retirement plans. Some states consider limited allocations to reduce risk. Others debate broader investment authority for account holders. The discussion continues to spread across state legislatures. Last year, lawmakers urged the SEC to speed up crypto access in  $12.5 trillion 401k retirement plans through new rules.

The bill now awaits the decision of the rest of the Senate. The governor may sign it into law in case it gets the approval of the lawmakers. It would start being implemented in mid-2026. Bitcoin, on the other hand, is selling at around $66,948 following a 1.16% decrease on a daily basis. It has a market cap of $1.33 trillion and a daily trade volume of $44.66 billion. In the last one month, Bitcoin has declined by 29% and it is still 47% lower than the last October peak of $126,198.