The California State Assembly took a decisive step towards integrating cryptocurrency into government operations by unanimously passing Assembly Bill 1180 (AB 1180) on June 2, 2025.
Landmark Vote In Sacramento
The measure cleared the lower chamber with a 78-0 vote and is set to move to the State Senate for review. If approved and signed by Governor Gavin Newsom, the law will allow certain state payments to be made in cryptocurrency under a five-year pilot program that will start on July 1, 2026.
The bill was authored by Assemblymember Avelino Valencia. It mandates the Department of Financial Protection and Innovation (DFPI) to design and oversee regulations that permit digital currency transactions for state fees. This move will position California to lead the country in public-sector crypto adoption while encouraging discussions around consumer accessibility, the role of government, and the use of digital assets in daily life.
Investors are already scanning the market for the list of upcoming crypto presales to find promising projects, and California’s move to official adoption adds credibility to a sector that was once considered high-risk and volatile. By tying cryptocurrencies to government transactions, the bill may influence individual and institutional confidence.
About The Bill
AB 1180 will not immediately result in crypto becoming a standard form of payment across state agencies. Instead, it introduces a phased pilot program that will run from July 1, 2026, to July 1, 2031. The DFPI will monitor and regulate payments under California’s Digital Finance Assets Law (DFAL) during this period.
The pilot program requires the DFPI to create a comprehensive report by January 1, 2028. This report must detail the number and value of all crypto transactions conducted, technical or regulatory difficulties faced, and recommendations for expanding crypto payments in the future when the pilot has finished. It is estimated that the preparation of this future framework and report will cost the state at least $150,000.
Assemblymember Valencia, author of the bill, claimed that AB 1180 is not just about financial innovation but also places a focus on consumer protection. The controlled and monitored program will hopefully strike a balance between the benefits of crypto integration and the need to protect against volatility, fraud, and other risks.
California’s Crypto Agenda
AB 1180 is only one of the latest pieces in a larger crypto legislative puzzle. AB 1052 is another proposal, called the “Bitcoin Rights Bill”, that was passed shortly after AB 1180. This bill aims to ensure the rights of Californians to self-custody their digital assets and use cryptocurrencies for private transactions without added tax.
There is also a controversial legislative move that involves a provision that extends California’s Unclaimed Property Law to cryptocurrencies. This will allow the state to seize crypto left dormant on exchange accounts for more than three years. This notion received strong pushback from industry leaders and consumer rights advocates. Critics claim that this policy involves government overreach and will place undue burdens on crypto holders who don’t apply to traditional financial accounts.
According to Valencia and his supporters, the suite of crypto bills is an attempt by the state to remain at the forefront of fintech regulation while setting standards that other states can adopt.
Comparing Other States
Should AB 1180 progress and become law, California will join a growing list of states that accept crypto payments for some fees, including Colorado, Florida, Louisiana, and Utah. These states mainly rely on third-party payment processors like PayPal to convert crypto into dollars before the state treasury receives the funds. This model is effective but introduces additional fees.
California has signaled its intent to avoid passing extra fees to consumers. This is to create fairness and accessibility. Should the approach be successful, it will serve as a model for how digital assets are integrated into public finance without hidden costs, which can discourage participation.
California’s massive size and economic influence also set it apart from other states. There are almost 40 million residents and a GDP that rivals that of entire countries. The state’s adoption of crypto will carry weight across domestic and international markets. It will increase the speed of adoption among businesses, individuals, and federal agencies.
Potential Benefits And Risks
AB 1180’s supporters argue that the acceptance of cryptocurrency payments will streamline government transactions and meet the needs of consumers looking for modern payment options. The California Blockchain Advocacy Coalition are in support of the pilot program since the real-world data gathered can be used to create more effective policies in the future.
However, there are risks, too. Crypto markets are known to be volatile, which raises concerns around how the state will manage price fluctuations when converting cryptocurrencies to dollars. There are also questions around cybersecurity and regulatory enforcement.
Legal experts warn that integrating digital assets into state systems is highly complex, especially regarding safeguarding consumer rights and compliance with existing financial laws.
The pilot program is designed to uncover and address these challenges by giving lawmakers the information they need to make informed decisions about the future of crypto payments.
