An amended California bill that proposes protections for digital asset payments and self-custody is awaiting its first reading in the state legislature.
On March 28, California’s Banking and Finance Committee chair Avelino Valencia amended Assembly Bill 1052, stripping out the original “Money Transmission Act” title and renaming it as “Digital assets.”
The revisions fold in a broad slate of digital asset-related protections, effectively reshaping the bill’s focus.
If passed, the bill would make it legal for any individual or business in the state to “accept payment in the form of a digital financial asset” for goods or services.
It also clarifies that digital assets used in private transactions will be treated as “valid and legal consideration.” Meanwhile, public entities would be barred from restricting or taxing the use of crypto purely based on its status as a payment method.
However, the bill makes clear that it does not require state or local governments to accept digital assets as payment themselves.
Another key addition protects crypto self-custody, prohibiting any public entity from placing limits or “imposing any requirements on the use of hardware or a self-hosted wallet” to manage digital assets.
AB 1052 also touches on unclaimed property laws. If a digital asset account goes untouched for three years, it would “escheat to the state,” with the holder required to transfer the asset to a state-designated custodian.
In a bid to avoid conflicts of interest, the bill expands the state’s Political Reform Act. It would block public officials from issuing, sponsoring, or “promoting a digital asset, security, or commodity,” and bans them from engaging in any transaction that “creates a conflict of interest with their public duties.”
AB 1052, originally introduced in February, is currently in the desk process, awaiting its first reading in the California State Assembly.
The proposed legislation arrives just as crypto is gaining more mainstream political backing in California. As previously reported by crypto.news, State Senator Ben Allen recently backed Dom Bei, a pro-Bitcoin candidate running for a seat on CalPERS, the nation’s largest public pension fund.
A study conducted by Toluna on behalf of crypto exchange Coinbase in February found that nearly 80% of California crypto holders would support a pro-crypto political candidate.
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