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California Assembly Passes Historic Bill to Integrate Digital Assets in State Payments

2 mins
Updated by Harsh Notariya
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In Brief

  • California Assembly passes AB 1180, authorizing digital asset payments for state fees through a pilot program.
  • The bill mandates a 2028 report on technical challenges and potential expansion of cryptocurrency payments.
  • AB 1180 positions California as a potential leader in cryptocurrency adoption within state financial systems.
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The California Assembly voted unanimously to pass Assembly Bill 1180 (AB 1180). It seeks to authorize the state to accept payments using digital assets.

The bill aims to position California as a leader in digital asset innovation. It also serves as a test for expanding cryptocurrency payment systems.

California Takes Step Toward Crypto-Based State Payments 

The bill, which cleared the Assembly with a decisive 68-0 vote, now advances to the California Senate for further review. Democratic assembly member Avelino Valencia, who spearheaded the initiative, presented AB 1180 on the Assembly floor. He described it as a “first-of-its-kind” pilot program. 

“I proudly rise to present AB 1180 that would establish a pilot program authorizing the Department of Financial Protection and Innovation to allow for the payment of fees using digital financial assets,” Valencia said.

AB 1180 requires the Department of Financial Protection and Innovation (DFPI) to create regulations allowing state payments under the Digital Financial Assets Law (DFAL) to be made with cryptocurrency. 

The bill mandates the DFPI to submit a report to the legislature by January 1, 2028. The report would contain data on cryptocurrency transactions, technical challenges encountered, and recommendations for expanding the use of digital assets in payments across other state agencies. Additionally, the bill is set to sunset on July 1, 2031.

Despite previous attempts to implement cryptocurrency payments, such as AB 953 (2019) and SB 1275 (2022), AB 1180 distinguishes itself by focusing on a smaller group of regulated payees, primarily businesses dealing in cryptocurrency

“This gives the state an opportunity to see if any concerns may arise with deploying this payment option,” the bill reads.

Furthermore, the bill has received support from the California Blockchain Advocacy Coalition. If approved by the Senate and signed into law by Governor Gavin Newsom, AB 1180 could position California as a pioneer in integrating cryptocurrency into state financial systems, potentially setting a precedent for other states nationwide.

This follows efforts in other states, such as Florida, Colorado, Louisiana, and Utah, which already accept cryptocurrency payments.

Meanwhile, AB 1180’s progress comes amid growing institutional interest in cryptocurrency within California. BeInCrypto reported that the US state is the largest investor in Strategy’s (MicroStrategy) shares, a company renowned for its substantial Bitcoin holdings under the leadership of founder Michael Saylor.

The state’s public pension funds, including CalSTRS and CalPERS, have a $276 million stake in MSTR. This investment highlights California’s expanding involvement with digital assets and indicates a wider recognition of cryptocurrency as a legitimate financial tool.

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Kamina Bashir
Kamina is a journalist at BeInCrypto, where she writes about all things crypto—think market trends, blockchain technology, regulatory shifts, and emerging trends in the digital asset world. With a gold medal in MBA International Business and extensive experience, she brings both expertise and clarity to her reporting. Previously at AMBCrypto, Kamina was responsible for writing and editing in-depth analyses, price predictions, AI and crypto blogs, and breaking news. She’s passionate about...
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