In February this year, California introduced Assembly Bill 1052 (AB 1052), which authorizes individuals and businesses to accept digital assets as payments for goods and services. Initially referred to as the Money Transmission Act, it was renamed Digital Assets. The law provides California consumers and investors with safety and soundness protections, including fee and risk disclosures or complaint mechanisms. AB 1052 was revised in March 2025 by democrat Avelino Valencia, who currently serves as the Chair of the prestigious Assembly Banking and Finance Committee, to include Bitcoin and top cryptocurrency investor protection. The revised legislation aims to secure cryptocurrency self-custody rights for the nearly 40 million people living in the U.S. state. More exactly, users can personally manage and secure their own digital assets without relying on third-party services like exchanges or custodial assets. Equally, the law expands the California Political Reform Act of 1974, which stops public officials from engaging in transactions involving crypto assets that could create conflicts of interest. The bill is currently in the “desk process”, which means it’s ready for debate and vote; decisions by leadership will determine how quickly it will move forward.
The CEO Of The Satoshi Action Fund Draws Attention To Bitcoin Rights’ National Potential
Denis Porter, the CEO and co-founder of the Satoshi Action Fund, a non-profit organization that educates policymakers and regulators about the use of Bitcoin, highlights that many economic policies that originate in California are later adopted by other states (or even at the federal level). California is America’s most populous state and the backbone of its economy, where new ideas come to life. The legislation that protects and defines the rights of individuals or businesses regarding Bitcoin and other cryptocurrencies can be adopted in other states that are more hesitant or less equipped to address such issues independently. California’s laws often influence and shape national policy, lending legitimacy and a proven model for other states to follow. In essence, the amendment to AB 1052 can reduce the perceived risk or difficulty of passing similar legislation elsewhere. Porter applauded the bill’s inclusion of legal frameworks for managing unclaimed property for digital assets. Much like traditional assets, a period of inactivity triggers the unclaimed property process – i.e., the funds must be turned over to the state, and owners can recover the unclaimed property by filling out an application. AB 1052 discloses that intangible property held in a digital asset account will be transferred to the state three years after written/electronic communication to the owner is returned undelivered.Around 99 Merchants In California Currently Accept Bitcoin Payments
According to BTC Map, a platform that visually displays information about Bitcoin, such as where businesses accept cryptocurrency payments, roughly 99 merchants in California embrace Bitcoin. Businesses are reluctant to accept the adoption of cryptocurrency payments due to high volatility, regulatory uncertainties, and the complexity of processing transactions. Moreover, low net profit margins leave little room for experimentation and investments in costly hardware and software. Tech entrepreneurs, innovators, and many in Silicon Valley’s ecosystem are fervent advocates, viewing cryptocurrency as the future of finance and a means to challenge standard financial systems. Consumers in California use Bitcoin via cryptocurrency kiosks and ATMs regulated under state law. They often have multiple wallet applications to pay for coffee, meals, or digital subscriptions. As more people are using digital assets and consider cryptocurrency as an investment, merchants need to start understanding the value of accepting it at the point of sale. This transition creates a rare opportunity to take the lead. Some experts recommend converting cryptocurrency to cash immediately to reduce exposure to price volatility and monitoring transactions to detect suspicious activity immediately.More Than 100 Bitcoin-Related Bills Have Been Introduced Statewide Across 35 States
More than 100 digital asset bills have been advanced across 35 states, and these proposals vary greatly, from enabling state investments in Bitcoin to clarifying how cryptocurrency is taxed. The digital economy has evolved at lightning speed, and traditional legal frameworks weren’t designed to handle digital assets. The legal community’s maturing understanding of digital property rights is driving numerous bills, each striving to balance the promotion of technological processes with the need for consumer protection. Texas is looking to create a strategic Bitcoin reserve, therefore becoming the third state to have a spot for cryptocurrency, after New Hampshire and Arizona. The passage of the Strategic Bitcoin Reserve bill (SB 21) shows Texas is progressively working to assimilate Bitcoin into its established financial and regulatory structures. Kentucky governor Andy Beshear signed a measure titled the Bitcoin Rights bill. It guarantees individuals the right to self-custody and provides regulatory clarity for crypto miners and node operators. President-elect Donald Trump wants to create a digital asset stockpile that includes cryptocurrencies seized by law enforcement. At present, no clear policy exists for managing these assets, which leads to a lack of accountability and insufficient exploration of strategies to centralize, secure, and maximize their value. The Crypto Strategic Reserve is set to include Bitcoin, Ethereum, XRP, Solana, and Cardano.Wrapping It Up
Well-defined rules can protect investors from scams and market manipulation, ensure transparency in transactions, prevent illegal activities (i.e., money laundering, fraud, misleading information), and encourage blockchain innovation. By establishing the legality of using cryptocurrency, California improves consumer confidence and encourages broader commercial adoption of digital assets.
AB 1052 solves the issue of dormant wallets, with no transactions or activity recorded for many years or even decades. If there’s no evidence of recent activity or successful communication with the account owner, the assets escheat to the state. In short, the significance of the law lies in its forward-thinking approach. Federal efforts, which focus on investor protection, market integrity, and anti-money laundering compliance, don’t undermine the established financial system.
The cryptocurrency industry now has a stronger foundation. The bad players have been removed from the blockchain space, and easier access to digital assets has attracted more investors. This, in turn, has caught the attention of financial players like mutual funds companies. It’s necessary to craft balanced, adaptive frameworks that protect users while fostering innovation.
