Ohio House Approves $200 Crypto Capital Gains Tax Exemption

The Ohio House of Representatives has taken a significant step towards enhancing the regulatory framework for cryptocurrency by approving the Blockchain Basics Act. This legislation aims to establish a $200 tax exemption for capital gains from cryptocurrency transactions, providing a minor tax relief for users. The bill also includes provisions that prohibit state and local governments from restricting the use of digital assets or interfering with the use of self-hosted and hardware wallets. This move is part of a broader effort to create a more favorable environment for cryptocurrency users and businesses in the state.

If the bill is signed into law by Governor Mike DeWine, it will also shield residential and industrial crypto mining operations from discriminatory local zoning changes. This means that individuals and businesses involved in mining, staking, asset exchange, or blockchain node operations will be exempt from money transmitter, security, and investment laws. The legislation further ensures that local governments cannot rezone areas with mining businesses without providing proper notice and an opportunity for comment, granting these businesses the right to appeal discriminatory zoning actions.

The bill, sponsored by Rep. Steve Demetriou, was first introduced in February and advanced from the House Technology and Innovation Committee before winning full House approval. The legislation comes at a time when crypto regulation across the nation is becoming more stringent, following the U.S. Senate's passage of major stablecoin reform under the GENIUS Act. This move by Ohio marks the latest in state laws enacted to codify rights for crypto users and providers, following Kentucky's passage of a Bitcoin and Ethereum Self-Custody Law in March.

Demetriou emphasized the importance of this legislation, stating that Ohio is ready to embrace the future of the economy through blockchain technology and digital assets. He believes that once the bill is passed, Ohio will become one of the first states to create a common-sense regulatory framework for these cutting-edge technologies and industries. The Satoshi Action Fund, which advocates for state-level crypto policy reform, praised the passage of the bill, noting that it is a clear signal that lawmakers are starting to come around to the idea of guarding the rights of industry participants while encouraging innovation in the state.

The $200 capital gains exemption is seen as a commonsense fix that helps everyday cryptocurrency users avoid unnecessary tax complexity. Dennis Porter, CEO and co-founder of the Satoshi Action Fund, expressed optimism that this momentum will carry forward in the Senate, positioning Ohio as a national leader on Bitcoin and digital asset policy. Other states considering new crypto regulations include Arizona, Florida, California, Texas, and Wyoming, indicating a growing trend towards more favorable cryptocurrency policies across the country.