California Nods Bill Allowing Agencies to Accept Crypto Payments

California edged closer to letting state agencies accept crypto payments after Assembly Bill 1180 cleared the State Assembly on June 2 with a unanimous 68-0 vote.

The bill, authored by Democratic Assembly member Avelino Valencia, tasks the Department of Financial Protection and Innovation (DFPI) with drafting rules to allow digital assets for state fees and transactions under the Digital Financial Assets Law (DFAL).

If the Senate passes AB 1180 and Governor Gavin Newsom signs it, the law takes effect July 1, 2026, with a five-year pilot scheduled through January 1, 2031.

The new law could reshape how residents interact with government services. It would align California with crypto-friendly states like Florida, Colorado, and Louisiana.

Inside AB 1180 Bill Legitimizing Crypto Payments in California

Introduced by Avelino Valencia, AB 1180 authorizes state agencies to accept digital currencies for payments under the Digital Financial Assets Law.

The bill defines digital financial assets as digital representations of value used as a medium of exchange, excluding legal tender.

The Department of Financial Protection and Innovation (DFPI) will oversee the program. It will be tasked with developing regulations and submitting a report by January 1, 2028.

The bill underwent amendments to focus solely on digital asset transactions, removing language related to ride-sharing companies and personal vehicles.

It complements AB 1052, another Valencia-led bill that protects crypto use in private transactions and affirms self-custody rights. AB 1052 passed an Assembly committee with an 11-0 vote on May 23, 2025, and awaits its third reading.

AB 1180’s passage has sparked enthusiasm in the crypto community. Kyle Chasse, a crypto advocate, posted on X,

“California moves closer to state-level crypto adoption with AB 1180 passing unanimously. This could position California as a leader in crypto-forward policies.”

AlvaApp noted, “This California bill is a game-changer for crypto legitimacy,” predicting ripple effects across the. However, Grok AI cautioned, “Bitcoin’s volatility and fraud risks are real concerns,” highlighting the need for robust safeguards.

A February 2025 Coinbase poll revealed that nearly 80% of crypto holders favor pro-crypto candidates. This means strong public support for policies like AB 1180.

This aligns with California’s history of embracing innovation, as seen in its 2023 Digital Financial Assets Law (AB 39), which established a licensing regime for crypto businesses.

Broader Implications

If AB 1180 becomes law, California could join Florida, Colorado, and Louisiana in accepting crypto for government services, enhancing its reputation as a tech hub.

The state’s $4.1 trillion economy (April 2025 GDP estimate) and tech-savvy population make it an ideal testing ground for crypto integration.

The pilot program could provide valuable data on transaction scalability, security, and regulatory challenges, potentially shaping national policy.

The bill also addresses a key barrier to crypto adoption: practical usability. By enabling residents to pay state fees with digital assets, California could bridge the gap between crypto’s theoretical potential and real-world application.

However, success will depend on addressing technical issues, such as transaction speed, and ensuring consumer protections, as mandated by the DFPI’s oversight.

AB 1180’s passage coincides with other pro-crypto developments in California. The state’s 2023 Digital Financial Assets Law (AB 39) and Senate Bill 401. Both signed by Newsom, established a regulatory framework for businesses and limited daily ATM transactions, respectively.