California Governor Gavin Newsom has signed SB 822, making California the first state to explicitly protect unclaimed cryptocurrencies from forced liquidation. The bill requires digital assets to be kept in their native form rather than converted to cash before being surrendered to the state.

Under the new regulations, asset holders must notify asset owners six to 12 months in advance of transfer and transfer the asset type, private keys, and amount to a cryptocurrency custodian designated by the State Controller within 30 days of the final report date. The State Controller can convert unclaimed cryptocurrency into fiat currency 18 to 20 months after filing. Valid applicants can then reclaim the original assets or sell the proceeds. (Decrypt)