Rhode Island lawmakers reintroduced legislation this week aimed at establishing a legislative commission to study blockchain technology, cryptocurrencies, and emerging digital assets. The effort reflects a continued pro-Bitcoin momentum within the state and a broader attempt to evaluate how digital assets could shape Rhode Island’s economy and regulatory framework.
Senate Bill S 2198, sponsored by Senators Lou DiPalma, Gu, Burke, Urso, Paolino, and Zurier, proposes a five-member commission tasked with reviewing existing Rhode Island statutes, assessing their applicability to blockchain-based activity, and identifying areas that require updates or clarifications. The bill also directs the commission to examine non-fungible tokens and other digital asset categories.
Breaking: Reintroduction of Rhode Island's bill to create a special legislative commission to study blockchain & cryptocurrency. Thanks @SenLouDiPalma for introducing this bill.
— RI Bitcoin Policy Institute (@RIBTCPolicy) January 26, 2026
S 2198 was passed in the @RISenate as S 0373 last year, but died in the @RIHouseofReps (H 5810).… pic.twitter.com/VWWN81ScPD
Commission structure and responsibilities
The proposed commission would include the Rhode Island Secretary of Commerce as chair and the Director of the Department of Business Regulation. Three additional public members would represent academic research, financial institutions, and federal securities knowledge. This composition ensures perspectives from regulation, industry, and scholarship are reflected in the panel’s work.
The commission would meet at least four times annually and operate publicly, posting findings and materials online. A final report containing legislative recommendations would be due by January 5, 2028. The recommendations are expected to encourage innovation and economic development while maintaining consumer protections.
Historical context and renewed momentum
This commission is not a new concept. A similar bill passed the Rhode Island Senate last year as S 0373 but stalled in the House under H 5810. The Rhode Island Bitcoin Policy Institute highlighted the reintroduction on social media, thanking Senator DiPalma and expressing optimism about passage this session based on ongoing discussions with Deputy House Speaker Ray Hull.
Supporters cite continued national competition among states to attract blockchain businesses, developers, and investment. Rhode Island aims to balance innovation with thoughtful oversight and position itself as a hub for emerging financial technology.
Parallel tax relief proposal for Bitcoin transactions
Alongside the study commission, Rhode Island lawmakers reintroduced legislation designed to reduce tax friction for small-scale Bitcoin transactions. Senate Bill S2021 proposes a temporary exemption from state income and capital gains taxes for Bitcoin sales or exchanges up to $5,000 per month, capped at $20,000 annually. The measure applies to both residents and Rhode Island-based businesses.
The bill adds a new section to the state’s personal income tax code, defining Bitcoin as a “digital, decentralized currency based on blockchain technology.” Taxpayers could self-certify eligibility on their returns without reporting individual transactions, while maintaining records for potential audits. If approved, the exemption would take effect on January 1, 2027, and expire one year later as a pilot program. The Department of Business Regulation would provide guidance on valuation methods and recordkeeping.
Previous blockchain initiatives in Rhode Island
Rhode Island has explored blockchain adoption in state operations since at least 2019. The state previously sought proposals from companies to use distributed ledger technology for notarization, registration, licensing, contracts, and fraud mitigation. House Bill 5425 similarly aimed to create a regulatory sandbox and encourage banking solutions tailored to blockchain innovators, citing challenges with federally insured institutions.
Both the study commission and the Bitcoin tax exemption reflect Rhode Island’s broader strategy to combine research, stakeholder input, and limited pilot programs. Lawmakers hope these efforts will attract technology firms, create jobs, and diversify the state economy without compromising consumer safeguards.
Gunel Ismayilova
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