Digital financial assets.

Assembly Member Valencia's legislation establishes procedures for unclaimed digital financial assets to escheat to California, extending the state's existing unclaimed property framework to address emerging forms of digital wealth. The measure creates a three-year escheatment period that begins when communications to account owners are returned undelivered or after the last documented account activity.

The bill requires holders with full control of private keys to transfer escheated digital assets directly to the State Controller while allowing those with partial key access to maintain custody until complete transfer capability exists. To manage escheated digital assets, the Controller may appoint licensed custodians who meet specific criteria, including secure storage capabilities, private key management expertise, and compliance with anti-money laundering regulations.

Account holders must notify apparent owners about potential escheatment 6-12 months before reporting the property to the state. The notification must detail the escheatment timeline and process for reclaiming assets. Owners can prevent escheatment by confirming their current contact information or demonstrating account activity through transactions, electronic access, or other actions that indicate awareness of the assets' existence.