The California State Assembly has approved bill AB-1052, which grants the state the right to seize cryptocurrencies held on exchanges that have shown no activity for three years. This move has sparked significant reactions among the cryptocurrency community, as it touches on the fundamental principles of decentralization of digital assets.
This is reported by Business • Media
What Changes Does the New Law Propose
According to the provisions of the bill, a crypto asset whose owner has not engaged in any actions—such as making transfers, logging into their account, or showing any other activity—for three years is deemed “unclaimed” and may be transferred to the state’s control. However, the assets are not subject to immediate liquidation or conversion into fiat currency, and they remain in the form of Bitcoin or other cryptocurrencies, allowing for the potential of future value growth.
“When your Bitcoin is transferred to the state as unclaimed property from an exchange, it remains in the form of Bitcoin and is not sold. You will be able to reclaim it in the form of Bitcoin from the State of California,” explained Peterson.
A user who has lost access to their assets due to inactivity has the right to contact the state and reclaim their cryptocurrency in its original form. The law does not require the transfer of private keys or wallets to government authorities—the storage is managed by exchanges until the owner makes a claim.
Community Reaction and Legal Aspects
This initiative expands existing legislation on unclaimed property, which already covers bank accounts and safe deposit boxes, to include digital assets. Proponents of self-custody of cryptocurrency have expressed concerns about such regulations, viewing them as a threat to the decentralized nature of Bitcoin. At the same time, experts point out that similar rules have long been in place in most U.S. states, and the return of assets to owners occurs after a proper claim is made.
“Most states have unclaimed property laws, and exchanges comply with them. Assets are returned to the owner as soon as they make a claim to the state,” wrote crypto lawyer Hailey Lennon.
Bill AB-1052 has already received unanimous support (78 votes in favor) in the State Assembly and is now headed for consideration by the California Senate. It is expected that it will either be refined or approved in its current form. A notable feature of the document is the retention of assets in cryptocurrency form, which, according to experts, favorably distinguishes it from mandatory conversion procedures into fiat, providing users with a chance to benefit from future market growth.