California's State Assembly has passed Assembly Bill (AB) 1052, a significant legislation that would regulate crypto payments and allow the state to seize idle crypto from exchanges if accounts remain inactive for three years. The bill, passed unanimously with a 78-0 vote, brings crypto under the state's unclaimed property laws, meaning that unclaimed crypto will not be liquidated, but rather held in its original form. If users don't demonstrate ownership through account activities such as deposits or withdrawals, the state can take possession of their assets. This legislation aims to update existing laws, allowing individuals and businesses in California to accept crypto in various transactions. The bill will now move to the Senate for potential modifications before heading to Governor Gavin Newsom for approval. While the bill has sparked mixed reactions online, with some viewing it as government overreach, proponents argue it provides a better framework for handling unclaimed crypto assets. The law is expected to take effect on July 1, 2026, requiring any digital financial asset business to obtain a license from the Department of Financial Protection and Innovation.

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