{"id":7662,"date":"2026-03-20T09:25:40","date_gmt":"2026-03-20T09:25:40","guid":{"rendered":"https:\/\/cryptonews.uk.com\/?p=7662"},"modified":"2026-03-20T09:25:40","modified_gmt":"2026-03-20T09:25:40","slug":"kentucky-crypto-bill-sparks-backlash-over-backdoor-wallet-provision","status":"publish","type":"post","link":"https:\/\/cryptonews.uk.com\/?p=7662","title":{"rendered":"Kentucky Crypto Bill Sparks Backlash Over \u201cBackdoor\u201d Wallet Provision"},"content":{"rendered":"<p><\/p>\n<div>\n<div id=\"blockquote-block_8411a786e99da63b91005b9595d6b1ff\" class=\"blockquote-container\" style=\"border-color: #5100fc\">\n<div class=\"blockquote-text\">\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A last-minute floor amendment to Kentucky\u2019s HB380 requires hardware wallet providers to assist users in resetting passwords, PINs, and seed phrases.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The provision contradicts Kentucky\u2019s own HB701, enacted unanimously in 2025, which explicitly protects self-custody rights and independent control of private keys.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">HB380 passed the Kentucky House 85-0 on March 13 and now sits in the Senate, where lawmakers can still revise or remove the controversial amendment before a final vote.<\/span><\/li>\n<\/ul>\n<\/div>\n<\/div>\n<p>A provision added to Kentucky\u2019s crypto ATM bill has triggered massive criticism from digital rights advocates, who say it could make self-custody hardware wallets unworkable by requiring manufacturers to help users recover lost access credentials.<\/p>\n<p>The disputed language appears in Section 33 of HB380, a 77-page bill passed unanimously in the Kentucky House on March 13.\u00a0<\/p>\n<p>It basically says hardware wallet providers must offer, and get ready for it, a way to reset a password, PIN, seed phrase or similar access information, and even assist wallet owners with that process after verifying their identity.<\/p>\n<p>But then, critics say that clashes with how non-custodial hardware wallets are built, because these devices are designed so the manufacturer does not know or store a user\u2019s seed phrase (which means there is nothing to recover).\u00a0<\/p>\n<p><strong>Read more: Citigroup Cuts Bitcoin and Ether Targets as U.S. Crypto Legislation Stalls<\/strong><\/p>\n<h2 class=\"wp-block-heading\" id=\"h-critics-and-supporters\">Critics and Supporters<\/h2>\n<p>Bitcoin Policy Institute managing director Conner Brown said the measure would amount to a ban on self-custody in practice. The group argued that compliance would require either a backdoor that weakens security for all users or a withdrawal from the Kentucky market.<\/p>\n<p>That position also appears to conflict with Kentucky\u2019s own recent crypto policy. In March 2025, the state enacted HB701, which protects the right of residents to hold digital assets in self-hosted wallets and retain independent control of private keys. A manufacturer recovery requirement would cut against that principle.<\/p>\n<p>Supporters of the bill have focused on crypto ATM fraud as HB380 would license ATM operators, cap daily transactions at US$2,000 (AU$2,800) and impose waiting periods for first-time users.\u00a0<\/p>\n<p>At the federal level, the amendment also appears out of step with recent statements supporting self-custody, including Executive Order 14178 and comments from the Securities and Exchange Commission (SEC) Chair Paul Atkins and Commissioner Hester Peirce.<\/p>\n<p><strong>Related: Bitcoin Hash Rate Drops as Energy Shock Triggers Miner Pressure<\/strong><\/p>\n<\/p><\/div>\n<p>Cryptocurrency Law,Law#Kentucky #Crypto #Bill #Sparks #Backlash #Backdoor #Wallet #Provision1773998740<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A last-minute floor amendment to Kentucky\u2019s HB380 requires hardware wallet providers to assist users in resetting passwords, PINs, and seed phrases. The provision contradicts Kentucky\u2019s own HB701, enacted unanimously in 2025, which explicitly protects self-custody rights and independent control of private keys. HB380 passed the Kentucky House 85-0 on March 13 and now sits in<\/p>\n","protected":false},"author":1,"featured_media":7663,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[2617,1214,749,62,3443,3444,2138,159],"class_list":{"0":"post-7662","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-bitcoin","8":"tag-backdoor","9":"tag-backlash","10":"tag-bill","11":"tag-crypto","12":"tag-kentucky","13":"tag-provision","14":"tag-sparks","15":"tag-wallet"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.6 (Yoast SEO v26.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Kentucky Crypto Bill Sparks Backlash Over \u201cBackdoor\u201d Wallet Provision - Crypto News: Latest Cryptocurrency News and Analysis<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/cryptonews.uk.com\/?p=7662\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Kentucky Crypto Bill Sparks Backlash Over \u201cBackdoor\u201d Wallet Provision\" \/>\n<meta property=\"og:description\" content=\"A last-minute floor amendment to Kentucky\u2019s HB380 requires hardware wallet providers to assist users in resetting passwords, PINs, and seed phrases. The provision contradicts Kentucky\u2019s own HB701, enacted unanimously in 2025, which explicitly protects self-custody rights and independent control of private keys. HB380 passed the Kentucky House 85-0 on March 13 and now sits in\" \/>\n<meta property=\"og:url\" content=\"https:\/\/cryptonews.uk.com\/?p=7662\" \/>\n<meta property=\"og:site_name\" content=\"Crypto News: Latest Cryptocurrency News and Analysis\" \/>\n<meta property=\"article:published_time\" content=\"2026-03-20T09:25:40+00:00\" \/>\n<meta name=\"author\" content=\"\u884c\u653f\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"\u884c\u653f\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/cryptonews.uk.com\/?p=7662\",\"url\":\"https:\/\/cryptonews.uk.com\/?p=7662\",\"name\":\"Kentucky Crypto Bill Sparks Backlash Over \u201cBackdoor\u201d Wallet Provision - Crypto News: Latest Cryptocurrency News and Analysis\",\"isPartOf\":{\"@id\":\"https:\/\/cryptonews.uk.com\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/cryptonews.uk.com\/?p=7662#primaryimage\"},\"image\":{\"@id\":\"https:\/\/cryptonews.uk.com\/?p=7662#primaryimage\"},\"thumbnailUrl\":\"https:\/\/cryptonews.uk.com\/wp-content\/uploads\/2026\/03\/crypto-bill.jpeg\",\"datePublished\":\"2026-03-20T09:25:40+00:00\",\"author\":{\"@id\":\"https:\/\/cryptonews.uk.com\/#\/schema\/person\/822778c5844e0d16d43dce6630f4f1bf\"},\"breadcrumb\":{\"@id\":\"https:\/\/cryptonews.uk.com\/?p=7662#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/cryptonews.uk.com\/?p=7662\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/cryptonews.uk.com\/?p=7662#primaryimage\",\"url\":\"https:\/\/cryptonews.uk.com\/wp-content\/uploads\/2026\/03\/crypto-bill.jpeg\",\"contentUrl\":\"https:\/\/cryptonews.uk.com\/wp-content\/uploads\/2026\/03\/crypto-bill.jpeg\",\"width\":1920,\"height\":1280},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/cryptonews.uk.com\/?p=7662#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/cryptonews.uk.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Kentucky Crypto Bill Sparks Backlash Over \u201cBackdoor\u201d Wallet Provision\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/cryptonews.uk.com\/#website\",\"url\":\"https:\/\/cryptonews.uk.com\/\",\"name\":\"Crypto News: Latest Cryptocurrency News and Analysis\",\"description\":\"Latest Crypto &amp; Bitcoin News\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/cryptonews.uk.com\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/cryptonews.uk.com\/#\/schema\/person\/822778c5844e0d16d43dce6630f4f1bf\",\"name\":\"\u884c\u653f\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/cryptonews.uk.com\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/e4c2d23409b09e004cef3facbe677e95c5401f9e29680f3a311e0130c5748089?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/e4c2d23409b09e004cef3facbe677e95c5401f9e29680f3a311e0130c5748089?s=96&d=mm&r=g\",\"caption\":\"\u884c\u653f\"},\"sameAs\":[\"http:\/\/demo3.aiwalls.com\/coinbase\"],\"url\":\"https:\/\/cryptonews.uk.com\/?author=1\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Kentucky Crypto Bill Sparks Backlash Over \u201cBackdoor\u201d Wallet Provision - Crypto News: Latest Cryptocurrency News and Analysis","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/cryptonews.uk.com\/?p=7662","og_locale":"en_US","og_type":"article","og_title":"Kentucky Crypto Bill Sparks Backlash Over \u201cBackdoor\u201d Wallet Provision","og_description":"A last-minute floor amendment to Kentucky\u2019s HB380 requires hardware wallet providers to assist users in resetting passwords, PINs, and seed phrases. The provision contradicts Kentucky\u2019s own HB701, enacted unanimously in 2025, which explicitly protects self-custody rights and independent control of private keys. HB380 passed the Kentucky House 85-0 on March 13 and now sits in","og_url":"https:\/\/cryptonews.uk.com\/?p=7662","og_site_name":"Crypto News: Latest Cryptocurrency News and Analysis","article_published_time":"2026-03-20T09:25:40+00:00","author":"\u884c\u653f","twitter_card":"summary_large_image","twitter_misc":{"Written by":"\u884c\u653f","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/cryptonews.uk.com\/?p=7662","url":"https:\/\/cryptonews.uk.com\/?p=7662","name":"Kentucky Crypto Bill Sparks Backlash Over \u201cBackdoor\u201d Wallet Provision - Crypto News: Latest Cryptocurrency News and Analysis","isPartOf":{"@id":"https:\/\/cryptonews.uk.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/cryptonews.uk.com\/?p=7662#primaryimage"},"image":{"@id":"https:\/\/cryptonews.uk.com\/?p=7662#primaryimage"},"thumbnailUrl":"https:\/\/cryptonews.uk.com\/wp-content\/uploads\/2026\/03\/crypto-bill.jpeg","datePublished":"2026-03-20T09:25:40+00:00","author":{"@id":"https:\/\/cryptonews.uk.com\/#\/schema\/person\/822778c5844e0d16d43dce6630f4f1bf"},"breadcrumb":{"@id":"https:\/\/cryptonews.uk.com\/?p=7662#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/cryptonews.uk.com\/?p=7662"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/cryptonews.uk.com\/?p=7662#primaryimage","url":"https:\/\/cryptonews.uk.com\/wp-content\/uploads\/2026\/03\/crypto-bill.jpeg","contentUrl":"https:\/\/cryptonews.uk.com\/wp-content\/uploads\/2026\/03\/crypto-bill.jpeg","width":1920,"height":1280},{"@type":"BreadcrumbList","@id":"https:\/\/cryptonews.uk.com\/?p=7662#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/cryptonews.uk.com\/"},{"@type":"ListItem","position":2,"name":"Kentucky Crypto Bill Sparks Backlash Over \u201cBackdoor\u201d Wallet Provision"}]},{"@type":"WebSite","@id":"https:\/\/cryptonews.uk.com\/#website","url":"https:\/\/cryptonews.uk.com\/","name":"Crypto News: Latest Cryptocurrency News and Analysis","description":"Latest Crypto &amp; Bitcoin News","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/cryptonews.uk.com\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/cryptonews.uk.com\/#\/schema\/person\/822778c5844e0d16d43dce6630f4f1bf","name":"\u884c\u653f","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/cryptonews.uk.com\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/e4c2d23409b09e004cef3facbe677e95c5401f9e29680f3a311e0130c5748089?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/e4c2d23409b09e004cef3facbe677e95c5401f9e29680f3a311e0130c5748089?s=96&d=mm&r=g","caption":"\u884c\u653f"},"sameAs":["http:\/\/demo3.aiwalls.com\/coinbase"],"url":"https:\/\/cryptonews.uk.com\/?author=1"}]}},"_links":{"self":[{"href":"https:\/\/cryptonews.uk.com\/index.php?rest_route=\/wp\/v2\/posts\/7662","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/cryptonews.uk.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cryptonews.uk.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cryptonews.uk.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/cryptonews.uk.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7662"}],"version-history":[{"count":0,"href":"https:\/\/cryptonews.uk.com\/index.php?rest_route=\/wp\/v2\/posts\/7662\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cryptonews.uk.com\/index.php?rest_route=\/wp\/v2\/media\/7663"}],"wp:attachment":[{"href":"https:\/\/cryptonews.uk.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7662"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cryptonews.uk.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7662"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cryptonews.uk.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7662"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}