CFTC Chair Michael Selig Criticizes Illinois Crypto Tax Law
The Commodity Futures Trading Commission (CFTC) Chair Michael Selig has criticized Illinois lawmakers for approving a new tax on cryptocurrency transactions. He argued that the measure could slow innovation and reduce the state’s competitiveness in the growing digital asset industry.
Illinois Approves 0.2% Crypto Transaction Tax
Illinois has introduced a 0.2% tax on cryptocurrency transactions through the Digital Asset Tax Act, which was signed into law by Governor JB Pritzker as part of the state’s FY2027 budget.
The new tax is scheduled to take effect in January 2027.
Selig Warns Against Slowing Blockchain Innovation
In an opinion article, Selig said Illinois lawmakers had “slammed the brakes on technological progress” by introducing the tax.
He argued that blockchain technology will transform the transfer of value in the same way the internet changed the exchange of information. According to Selig, assets such as currencies, stocks, bonds, and commodities are expected to become increasingly tokenized in the future.
Crypto Industry Raises Concerns
The crypto industry has strongly opposed the new tax. Several industry groups have described it as one of the toughest digital asset tax policies in the United States.
Critics also questioned how the law will be implemented and whether it could discourage blockchain companies from operating in Illinois.
Federal and State Policies Move in Different Directions
The Illinois tax arrives as U.S. lawmakers continue working on federal crypto market structure legislation. At the same time, regulators, including the CFTC, are providing greater regulatory clarity for digital assets.
Selig said Illinois has chosen a different path by introducing additional taxes instead of supporting innovation. He warned that the decision could leave the state behind as blockchain adoption continues to grow.
What This Means for the Crypto Industry
The debate over Illinois’ crypto tax highlights the growing divide between state and federal approaches to digital asset regulation. While Washington focuses on creating a clearer regulatory framework, Illinois is moving forward with a new tax policy that has drawn strong criticism from regulators and industry leaders.
