California just drew the line between crypto and cash: Here’s why it matters

California’s SB 822 ends forced crypto sell-offs and requires holders to send in-kind transfers of unclaimed crypto to the state, promoting stronger consumer rights.

California’s Senate Bill 822 (SB 822), signed into law by Governor Gavin Newsom in October 2025, makes California the first US state to protect unclaimed crypto assets from forced liquidation.

Treating digital assets similarly to bank accounts and securities, SB 822 requires unclaimed cryptocurrencies to be transferred in their native form rather than immediately liquidated. This helps prevent forced liquidation of assets like Bitcoin (BTC) or Ether (ETH), which could otherwise trigger taxable events for holders without their consent.

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