In a landmark decision, California’s State Assembly has unanimously passed a bill that would enable residents to pay certain state fees using cryptocurrency. Assembly Bill 1180 (AB 1180), approved by a 78–0 vote on June 2, now moves to the state Senate for further consideration.
The bill directs the Department of Financial Protection and Innovation (DFPI) to establish a regulatory framework allowing state departments to accept digital assets as payment. These transactions would fall under the scope of California’s Digital Financial Assets Law, which governs crypto-related business activity within the state.
The DFPI—California’s top financial regulatory body—is charged with balancing consumer protection and financial innovation. Under this legislation, the agency must draft rules that both facilitate crypto payments and ensure regulatory safeguards. This includes licensing requirements for crypto service providers, embedding digital assets more firmly into California’s existing financial oversight infrastructure.
Crypto Pilot Program Could Launch by 2026
If the bill clears the Senate and is signed into law by Governor Gavin Newsom, AB 1180 would take effect on July 1, 2026, initiating a five-year pilot program set to run through January 1, 2031.
Led by Democratic Assemblymember Avelino Valencia, the initiative would allow select state fees to be paid using approved cryptocurrencies. During the program’s duration, the DFPI would be responsible for tracking, documenting, and reporting on all crypto transactions carried out under the Digital Financial Assets Law. A midpoint report is due by January 1, 2028, analyzing technical performance, regulatory issues, and adoption metrics to guide long-term policy decisions.
California’s approach joins other U.S. states like Florida, Colorado, and Louisiana, which have already piloted limited crypto payment systems. However, AB 1180 is seen as a more structured and deliberate effort—emphasizing innovation while maintaining rigorous oversight.
The bill was amended four times before passing the Assembly floor. Notably, lawmakers removed a provision related to defining ride-share vehicles, opting to maintain the bill’s tight focus on digital assets and financial infrastructure.
California Advances Broader Crypto Rights Legislation
While AB 1180 focuses on enabling crypto payments to state agencies, a companion effort—AB 1052, dubbed the “Bitcoin Rights” bill—seeks to codify broader protections for digital asset users across the state.
AB 1052 would guarantee Californians the right to self-custody their crypto holdings, a core principle of decentralized finance. It also proposes formal recognition of digital financial assets as valid payment methods in private transactions, protecting users from discrimination or legal ambiguity.
Crucially, the bill would prohibit public entities from levying additional taxes or restrictions on digital assets simply because they are used for payments. This provision aims to prevent a patchwork of conflicting local regulations that could discourage adoption.
The bill passed its first committee review with an 11–0 vote on May 23 and is awaiting a third reading. If enacted, AB 1052 would further establish California as one of the most forward-thinking states in crypto regulation and individual digital rights.
As of now, at least 117 businesses across California accept Bitcoin payments—highlighting growing demand for crypto integration in daily commerce among the state’s nearly 40 million residents.
Quick Facts
- California’s AB 1180 would allow select state fees to be paid using cryptocurrency starting in July 2026.
- The Department of Financial Protection and Innovation (DFPI) will oversee licensing, compliance, and reporting during a five-year pilot program.
- A midpoint review is due in January 2028 to evaluate technical and regulatory challenges.
- AB 1052, a separate bill, aims to protect the right to self-custody and prohibit discriminatory crypto taxation.
- At least 117 businesses in California already accept Bitcoin payments.
