California State Assembly member has proposed an amendment that will protect residents’ ability to use money transmitters. cryptocurrencies As a method of payment.
The bill was first introduced on 20 February by Democrat senator Laura Richardson as the Money Transmission Act. Its main concern had been to require digital currency. Wallet Californian providers are required to take “certain actions” in order to secure their products. This includes the use of 2-factor authentication.
Avelino Vallena, Democrat Assembly Member, introduced a new amendment on Friday that renames it the Digital Assets Act. It also adds new clauses to protect cryptocurrency use in California.
This bill aims to authorize individuals and business in California, including private parties, to accept Bitcoin as payment for services and goods.
This amendment prevents California’s state from taxing crypto payments for goods and service.
As Dennis Potter, CEO of Satoshi Action Fund and co-founder told us: DecryptIt “explicitly confirms that individuals have the right to keep their Bitcoins and digital assets in self-custody.”
Potter claims that the residents will be able to handle their cryptos independently and not have to send them to a custody or centralized wallet.
The new legal protections
Potter said that the bill’s introduction was significant, even though it may not be anything new for many crypto users.
He said, “These provisions add new protections to California’s digital asset approach that was not codified before.”
Other provisions in the bill include a stipulation that California’s Unclaimed Property Law would apply to crypto—meaning that exchanges, for example, would have to transfer crypto to the state in the event that the corresponding customer had been inactive and unresponsive for at least three years.
It also broadens the scope of the Political Reform Act of 1973 to cover crypto and, as such, prohibits “public officials” from issuing or sponsoring a digital security or commodity, or even promoting it.
Assemblymember Valencia emphasized that the purpose of this provision is to “prevent conflicts of interests and maintain integrity in public offices.”
Potter explained that the bill prohibits public officials to issue, sponsor, or promote digital assets, commodities, securities or other financial instruments. This is to prevent officials using their positions in an unduly influencing the market.
This latter section may also be the response of California—which is a predominantly Democrat-controlled state—to Official Trump (TRUMP), the Solana-based coin that U.S. Presiden Donald Trump introduced before taking office in January.
The inclusion of the ban in the bill could encourage Democrats to use digital currency, even though there’s no evidence of any California official promoting it or publicly launching one.
Congress has been presented with another bill that would prohibit crypto promotions, but it is a federal law. With both chambers being controlled by Republicans however, this has little chance of becoming law, at least until the midterm elections in 2026.
Satoshi Action Fund, in a tweet, defended the bill and said that “nearly forty million Americans’ right to self custody will be protected” if California passed it.
We are proud to officially announce that ‘Bitcoin Rights’ has been introduced in the California Assembly by the Chair of Banking and Finance – Assemblyman Valencia.
After the bill is passed, almost 40,000,000 Americans will now have the right to their own custody protected!
The bill also creates… pic.twitter.com/zvLwCM46je
— Satoshi Action Fund (@SatoshiActFund) March 29, 2025
Satoshi Action Fund is a not-for-profit organization Bitcoin This advocacy organization, which was founded by ex-members of the Trump first administration, played a key role in the recent months when it came to meeting legislators and encouraging them to support crypto and Bitcoin legislation.
The company was instrumental in helping Kentucky pass a new law that establishes individuals’ right to keep crypto in their own custody, and confirms that mining or staking rewards do not constitute securities.
It also claims credit for influencing the Oklahoma senate’s recent discussion on a BTC-based strategic reserve law.
Dennis Potter says that California’s Digital Assets Act, and other bills similar to it, “reflect a wider shift” in the US, towards the integration of cryptocurrency, such as Bitcoin, into the legacy financial systems.
California’s position as the 5th largest economy with an estimated gross state products of almost $3.9 trillion (in 2023) is crucial in setting trends in regulatory policy, he added. He said that the bill as amended “indicates evolving attitudes where digital currency is increasingly seen to be legitimate financial instruments warranting regulatory structures that protect consumers and encourage innovation.”
