Unclaimed property: digital financial assets.

Senator Becker's legislation brings digital financial assets under California's Unclaimed Property Law, establishing procedures for when these assets escheat to the state and how they must be managed thereafter. The bill defines digital financial assets as intangible property and creates specific requirements for businesses holding such assets to notify apparent owners before escheatment occurs.

Under the new provisions, digital assets become subject to escheat after three years of inactivity. Holders must attempt to contact apparent owners between six and twelve months before reporting the assets as unclaimed, using certified mail when a physical address is available or electronic communications when authorized. The notification must include specific language about the risk of escheatment and provide owners with a method to confirm their current contact information, which restarts the escheatment period.

The bill outlines detailed procedures for transferring escheated digital assets to the state. Holders must deliver the exact asset type, private keys, and amounts to the Controller's designated cryptocurrency custodian within 30 days of reporting. For cases involving partial private keys, holders must attempt to obtain the remaining keys within 60 days of determining escheat eligibility. The Controller may select qualified custodians to manage escheated digital assets, with custodians required to meet specific security, compliance, and operational criteria. These assets may be converted to fiat currency between 18 and 20 months after reporting, with claimants entitled to receive either the digital assets or the net proceeds from their conversion.