California has taken a significant step in regulating unclaimed cryptocurrency with the introduction of SB 822, which aligns digital assets with existing property laws. As emphasized in the official statement, this new legislation aims to provide clarity and structure for the management of abandoned cryptocurrencies, ensuring better protection for consumers.
Classification of Digital Financial Assets
Under SB 822, digital financial assets are classified as intangible property, which means they are subject to escheatment rules similar to traditional assets. The law stipulates that assets will be considered abandoned if there is no owner activity for three years. This provision is designed to safeguard the interests of both the state and the asset holders.
Notification Requirements for Asset Holders
The bill also imposes a requirement for holders to notify owners six to twelve months prior to reporting assets as unclaimed. This advance notice is intended to give owners a fair chance to reclaim their assets before they are transferred to a state-appointed crypto custodian. Furthermore, the law mandates that the same type and amount of cryptocurrency must be transferred without liquidation, ensuring that owners receive their original assets.
Impact on Stakeholders and Consumer Protection
Overall, SB 822 not only streamlines operations for stakeholders involved in the management of unclaimed cryptocurrencies but also enhances consumer protection. By establishing a regulatory framework, California sets a precedent that could influence how other states approach the management of digital assets.
In a related development, Inveniam Capital Partners and MANTRA have launched Inveniam Chain, a new Layer 2 blockchain aimed at transforming private real estate management. For more details, see read more.
