Crypto trade groups sue Illinois over new digital asset tax

The Crypto Council for Innovation and Blockchain Association filed a lawsuit on August 15, 2026 in Sangamon County challenging Illinois' new 0.2% tax on cryptocurrency transactions and storage, joining an earlier July 2026 suit by the Digital Chamber. The tax applies to firms based in Illinois or serving Illinois residents with receipts exceeding $100,000, and is projected to raise $60 million for the state budget. The industry groups claim the tax violates the U.S. Constitution, Illinois Constitution, and Internet Tax Freedom Act by discriminating against digital assets compared to traditional financial transactions. The tax is imposed on transaction volume regardless of whether businesses have lost money on crypto.

Illinois digital asset tax law

• ▪The Illinois digital asset tax will be imposed even if the taxpayer has lost money on crypto, because the tax is based on transactions.
• ▪Illinois enacted a law that imposes a 0.2% tax on businesses transacting or storing crypto for customers within Illinois borders.
• ▪The Illinois digital asset tax applies to firms that are based in Illinois or provide services to Illinois residents with total receipts of more than $100,000.

Multiple industry lawsuits

• ▪Ji Kim leads the Crypto Council for Innovation.
• ▪The Digital Chamber filed a lawsuit against Illinois in July 2026 over the state's digital asset tax.
• ▪The Crypto Council for Innovation and the Blockchain Association sued Illinois on August 15, 2026 over the state's digital asset tax.
• ▪The Crypto Council for Innovation and Blockchain Association lawsuit against Illinois was filed in Sangamon County.
• ▪Summer Mersinger is CEO of the Blockchain Association.

Crypto industry opposition

• ▪Ji Kim stated that a tax on digital asset activity with no equivalent tax for traditional assets unlawfully picks winners and losers through the tax code.
• ▪Ji Kim stated that the Illinois digital asset tax singles out digital assets for uniquely punitive treatment based on the underlying technology rather than the substance of the transaction itself.
• ▪Summer Mersinger stated that Illinois cannot impose a novel tax regime that discriminates against digital commerce, creates uncertainty for consumers and businesses, and threatens to fragment a rapidly growing national market.

Tax structure details

• ▪The Illinois digital asset tax is a 0.2% tax on businesses transacting or storing crypto for customers.
• ▪The Illinois digital asset tax has been estimated to potentially raise $60 million for the state budget.
• ▪The Illinois digital asset tax applies to firms that are based in Illinois or provide services to Illinois residents with total receipts of more than $100,000.