- The California Assembly passed AB 1180, allowing state agencies to accept Bitcoin and digital assets as official payment methods.
- DFPI will oversee a pilot program and report on digital transactions and operational challenges by January 2028.
- Digital financial asset businesses must obtain licenses by July 2025 and meet new compliance and stablecoin handling rules.
On June 4, the California State Assembly unanimously approved AB 1180, allowing the state government to accept Bitcoin and other digital assets for payments. The bill received 68 votes in favor and now awaits review by the state Senate.
AB 1180 introduces a pilot program through the Department of Financial Protection and Innovation (DFPI). The initiative enables fee payments using digital assets. According to Assemblymember Avelino Valencia, the bill aims to modernize state payment systems and study the long-term role of digital finance.
Digital Financial Assets Law Set for Implementation
The legislation establishes the Digital Financial Assets Law (DFAL), creating a licensing framework for digital asset businesses. Starting July 1, 2025, individuals and firms engaging in digital financial activities with California residents must obtain a DFPI license.
The DFPI must submit a report by January 1, 2028. The report will cover the volume and value of transactions, challenges faced, and policy recommendations. Additionally, stablecoin activity must comply with licensing regulations to ensure consumer protection.
Stablecoin and Record-Keeping Mandates Introduced
The bill requires licensees to keep transaction records for five years. It also restricts stablecoin transactions to licensed entities or approved financial institutions. These provisions are scheduled to take effect in July 2025.
Earlier proposals such as AB 953 and AB 3090 aimed to integrate crypto into cannabis tax payments but failed to move forward. Similarly, SB 1275, which sought broader use of digital assets for government services, did not pass in the Senate.
The bill comes as states like Colorado, Utah, and Louisiana explore similar initiatives. However, the California Blockchain Advocacy Coalition noted that states currently rely on third-party processors like PayPal, which add fees and currency conversion steps.
