California Embraces Cryptocurrency for Public Payments
California has moved a step closer to making cryptocurrency a practical part of everyday transactions, following a unanimous vote in its State Assembly. Lawmakers have approved a new measure that would allow state departments to accept Bitcoin and other digital assets for payment of government fees.
The legislation, referred to as Assembly Bill 1180 (AB 1180), was presented by Assemblymember Avelino Valencia. On 2 June, the bill passed with complete support—68 members voted in favour, and none opposed it. With this approval, the bill now advances to the California State Senate for further consideration.
If successful in the Senate and signed into law by Governor Gavin Newsom, the new regulations would come into effect on 1 July 2026. The initiative would begin with a pilot phase, giving select government departments the ability to accept digital currencies from residents for services such as permits, licences, or fines.
Image 1: California Set to Accept Bitcoin (Source: Decrypt)
A Trial Towards Digital Integration
This move is being led by the Department of Financial Protection and Innovation (DFPI), which oversees the financial sector in California. Under the proposed legislation, the DFPI will be responsible for setting up a framework that permits the use of cryptocurrencies for certain payments made to the state.
The plan includes a long-term test period that runs through to 1 January 2031. This will allow the department time to manage the system, gather data, and monitor how crypto transactions perform in a public sector setting.
As part of its responsibilities, the DFPI must also provide a detailed progress report by 1 January 2028. This document is expected to cover the number of transactions processed using digital currencies and identify any logistical or regulatory considerations encountered during the trial.
Valencia, who represents a district in Southern California and has a background in technology-rich San Jose, has voiced strong confidence in the role digital assets will play in society’s future. He sees this legislation as a stepping stone towards the modernisation of government services.
JUST IN: California Assembly passes bill to allow the state to receive payments in Bitcoin and digital currencies.
It passed 68-0, and now heads to the Senate. pic.twitter.com/3JWXlpuEWh
— Bitcoin Laws (@Bitcoin_Laws) June 3, 2025
Part of a Broader Crypto-Friendly Approach
The push for digital payment options does not stop with AB 1180. Another bill, AB 1052, has also gained momentum. This second bill focuses on protecting the rights of Californians to hold and use digital currencies in private transactions, ensuring that government bodies cannot discriminate against crypto users simply because of the type of asset being used.
AB 1052 has already passed its first committee review, receiving unanimous approval and moving closer to becoming law. It complements AB 1180 by laying the groundwork for wider acceptance and normalisation of digital financial assets throughout the state.
If both bills are enacted, California will follow in the footsteps of other U.S. states such as Colorado, Florida, and Louisiana, which have introduced similar crypto payment systems for public services in recent years. However, California’s population and influence make this a significant development in the broader shift towards digital finance.
Although digital currencies like Bitcoin are not classified as legal tender in the United States, the bills aim to make them a legitimate option for voluntary use in public and private financial activities.
Image 2: Source: CoinGape
Momentum for Digital Finance Grows
California is home to a growing number of merchants and service providers who already accept Bitcoin, with public listings showing at least 117 businesses in the state offering this payment method. Supporters of the legislation argue that this growing adoption signals readiness for more structured integration into official systems.
The progress of AB 1180 has been met with encouragement by players in the crypto and financial technology sectors. Several industry observers have commented that developments like this one reflect a strengthening belief in the role of digital currencies in future economic systems.
Read Also: Australia Turns to Peer-to-Peer Bitcoin Trading in 2025
With full support from the Assembly and growing interest from the public and private sectors alike, the groundwork is being laid for a more flexible and innovative approach to how Californians interact with public services. If the Senate and the Governor give the green light, the state could be on track to lead the way in government-backed cryptocurrency adoption.
