California Assembly Approves Crypto Payment for State Services
The California State Assembly has unanimously passed AB 1180, a bill that could pave the way for the state government to accept Bitcoin and other cryptocurrencies for official payments.
Passed on June 4 with a 68–0 vote, the legislation now heads to the state Senate for further deliberation, according to Cryptopolitan.
Introduced by Assemblymember Avelino Valencia, the bill proposes a pilot program under the Department of Financial Protection and Innovation (DFPI) that would permit residents to pay state fees using digital assets. The pilot would conclude by July 1, 2031, with a report due in January 2028 evaluating its performance.
Beyond enabling crypto payments, AB 1180 establishes a comprehensive regulatory framework titled the Digital Financial Assets Law (DFAL). Beginning July 1, 2025, any business operating in California’s digital asset sector must be licensed by the DFPI.
Key provisions include mandatory transaction records, a ban on unlicensed stablecoin activities, and clear consumer protection requirements.
Valencia said the bill reflects California’s intention to modernise public services in line with rising cryptocurrency adoption. He noted that states like Colorado, Utah, and Louisiana already permit crypto payments for state services.
Despite the bill’s forward momentum, concerns remain about infrastructure readiness. The California Blockchain Advocacy Coalition warned that the state currently lacks a reliable system to convert cryptocurrencies into U.S. dollars—an essential step since all state budgets are denominated in fiat.
For example, Colorado uses PayPal’s Currency Hub to process crypto payments, which involves a 1.83% fee plus $1. Previous crypto-focused bills in California—AB 953, AB 3090, and SB 1275—stalled largely due to similar operational and logistical concerns.
While AB 1180 represents a breakthrough in digital payment policy, its long-term success hinges on whether California can build a secure, cost-effective system to manage crypto-to-fiat transactions at scale.
