California authorities pass bill on confiscation of unclaimed Bitcoins
California Assembly approves bill to claim unclaimed crypto under revised property law
On June 3, 2025, the California State Assembly passed Assembly Bill 1052, a proposal that would allow the state to claim Bitcoin and other cryptocurrencies left unclaimed on crypto exchanges for more than three years.
The legislation is part of a broader revision to California’s Unclaimed Property Law, which historically applies to intangible personal assets—such as uncashed checks or dormant bank accounts, reports CoinGape.
AB 1052 expands the law’s scope to include digital assets and crypto held in custodial accounts. Introduced by Assemblymember Valencia on February 20, the bill has been revised three times, most recently on May 23, and now proceeds to the California Senate for further debate.
Seized crypto to be held—not sold
Despite backlash from the crypto community, the bill clarifies that seized cryptocurrencies will not be liquidated. Instead, if an exchange or holder has access to the private keys of such unclaimed assets, they must transfer the assets “in native form” to a qualified custodian chosen by the California State Controller.
This provision aims to allay fears of state overreach and arbitrary confiscation. The assets will be held in custodial trust, similar to how the state handles other forms of escheated property, and owners can reclaim them through proper legal channels. Exchanges will be required to report and deliver these assets within 30 days of the state declaring them abandoned.
Crypto industry questions fairness and legality
The bill has drawn intense scrutiny from digital asset advocates, who argue that it sets a concerning precedent by granting government agencies the authority to seize private crypto holdings. Critics also highlight that crypto wallets often go unused for long periods due to market timing or loss of keys—factors that don’t necessarily imply abandonment.
Still, supporters frame AB 1052 as a consumer protection measure, ensuring unclaimed property is accounted for and retrievable. As it moves to the California Senate, the bill is expected to face amendments and ongoing debate, particularly over the definition of control and ownership in decentralized finance.
Recently we wrote that new SEC Chairman Paul Atkins has set the stage for a regulatory shift in the U.S. crypto landscape, promising to replace the previous era of ambiguity with transparent, rules-based oversight.
