California seeks to seize cryptocurrencies inactive for more than 3 years

On Tuesday, the California Assembly passed Bill AB 1052 aimed at regulating cryptocurrency payments and related business activities in the state.

A particular provision of this bill has raised concerns among Bitcoin investors & Co, as it would allow the state to seize unclaimed cryptocurrency holdings from exchange customers after three years of inactivity!

In practice, cryptocurrency holders must perform "an act of property interest" at least once every three years. This could be a transaction involving their digital asset accounts or simply accessing their accounts.

If no activity is detected during this period, cryptocurrencies could become (temporarily) the property of the state! But once seized, they would not be liquidated by the authorities; rather, they would be held by a custodian for customers to retrieve them later.