In a groundbreaking move for digital asset regulation, California has become the first state in the U.S. to enact legislation protecting unclaimed cryptocurrencies from forced liquidation. Signed into law by Governor Gavin Newsom in October 2025, Senate Bill 822 marks a significant shift in how digital assets are treated under state law. The source notes that this legislation could set a precedent for other states to follow suit.
Senate Bill 822 Overview
Senate Bill 822 establishes that unclaimed cryptocurrencies will be treated similarly to traditional bank accounts and securities. This means that instead of being liquidated immediately, unclaimed digital assets must be transferred in their native form, preserving the original holdings of individuals. This provision is particularly important for assets like Bitcoin and Ethereum, as it prevents triggering taxable events for holders without their consent.
Integration into California's Unclaimed Property Law
The law integrates digital assets into California's Unclaimed Property Law, allowing account holders to reclaim their original cryptocurrencies or the net proceeds from any sale. To do so, individuals must submit a valid claim to the State Controller, ensuring that they have the opportunity to recover their assets without facing the risks associated with forced liquidation.
Impact on Consumers and Future Regulations
This legislative change not only protects consumers but also sets a precedent for how other states may approach the regulation of digital assets in the future.
On the same day, the Federal Reserve proposed FedAccounts to enhance access to Reserve services for businesses, contrasting with California's recent legislation on unclaimed cryptocurrencies. For more details, see FedAccounts proposal.
