May 2025 │ Legislation & Regulation Update

The Unclaimed Property Legislative Alert

Summary of Legislation — Week Ending May 16, 2025

ARIZONA: Enacted HB 2749 which was amended from the original bill and now (1) creates a bitcoin and digital assets reserve fund to be administered by the Treasurer and subject to legislative appropriation; (2) provides definition for “airdrop”, “digital assets” and “stake”; (3) provides a three (3) year abandonment period after communication returned by USPS or email / other electronic messaging method for digital assets and further defines “exercise of an act of ownership interest” as (a) owner taking action; (b) conducting a transaction including depositing or withdrawing monies from the account; (c) electronically accessing the account; (d) conducting any activity in another account owned by owner and held by same holder; and (e) taking any other action that reasonably demonstrates that the owner knows the property exists; (4) requires digital assets to be reported / delivered in its native form to the department or to the department’s qualified custodian within thirty (30) days after reporting; (5) requires the qualified custodian to transfer any unclaimed airdrops or staking rewards to the bitcoin and digital asset reserve fund three (3) years after the digital asset was transferred to the qualified custodian; (6) provides a definition of “qualified custodian”; and (7) requires digital assets listed on established exchange to be sold at the prevailing price on exchange at the time of sale. 

MAINE: Introduced LD 1969 which (1) adds virtual currency to definition of “Property”; (2) provides definition for “Virtual currency”; (3) clarifies the abandonment of payroll card or demand, savings or time deposit to three (3) years after the later of maturity (if applicable) and the apparent owner’s last indication of interest in the card or deposit; (4) provides abandonment period for terminated contribution or retirement plan to as soon as administratively feasible after the date of plan termination; (5) adds tax-advantaged retirement accounts to abandonment presumption and amends the presumption for tax-deferred or tax-advantaged accounts to three (3) years after date of distribution is required or for tax-advantaged accounts three (3) years after the death of the apparent owner; (6) clarifies the abandonment of an account under a state’s Uniform Gifts to Minors Act or Uniform Transfers to Minors Act to three (3) years after the date the custodian is required to transfer the property to the minor or the minor’s estate; (7) provides that virtual currency is presumed abandoned five (5) years after last indication of interest by owner; (8) allows administrator to decline virtual currency if determined to not be freely transferable, is of nominal value, or value is less than expenses to maintain, notice or sell property; (9) allows administrator to prescribe by rule virtual currency that may be exempt from reporting or liquidating; (10) requires holder to liquidate virtual currency within 30 days before reporting; (11) requires holder to notify administrator in writing if virtual currency cannot be liquidated and provide reasons why unable to liquidate and requires the administrator to direct holder concerning an alternate disposition; (12) limits recourse by owner against administrator or holder as a result of liquidation; (12) amends security abandonment period to three (3) years after apparent owner’s last indication of interest; (13) removes the requirement of evidence of receipt of distribution by electronic means and automatic withdrawals from indication of interest and specifically exempts a recurring automated clearing house debit or credit previously authorized; (14) clarifies that account proceeds from life insurance or annuity are abandoned at the later of what is provided for in statute or three (3) years after the beneficiary’s last indication of interest in account; (15) provides that the address of apparent owner for property where ownership vests in a beneficiary is presumed to be the address of deceased owner where the address of beneficiary is unknown; (16) adds virtual currency to holder notice requirements and requires that the notice state the property may be sold by holder prior to reporting; (17) prohibits escheat fees, unclaimed property reporting fee or similar charges relating to the property being subject to the unclaimed property act; (18) clarifies that the commencement of action, proceeding or examination tolls the running of the period of limitations; (18) adds a new provision requiring that a holder hold property in trust for benefit of the state and further provides that the holder is liable to the state for the full value of the property plus any interest and penalties; (19) updates the confidentiality of working papers to include work-in-progress reports, exam records, etc. and provides specific instances where the documents “may” be used.; and (20) clarifies that an examination of a holder will proceed if a holder does not execute a confidentiality agreement or is unable to come to terms on confidentiality agreement within 90 days and must rely on the confidentiality provisions provided in statute.

NEBRASKA: Enacted LB 183 which (1) clarifies that the Treasurer publish annual notice in each county where a last known address exists; and (2) prohibits the charging of finders’ fees by commercial or professional locators until twenty-four (24) months after the names from holders’ reports have been published / disclosed.

Summary of Legislation — Week Ending May 2, 2025

ALABAMA: Introduced HB 617 which (1) provides definitions for “account activity” and “custodian” as it relates to digital assets, “digital asset”, “digital asset account”, “private key”, and “qualified custodian”; (2) provides that property in a digital asset account is abandoned three (3) years after the date a written or electronic communication was returned as undeliverable or of the last account activity if owner did not receive communication; (3) requires the treasurer to select a qualified custodian to manage any digital assets held; (4) outlines considerations for the treasurer when selecting a qualified custodian; (5) requires the treasurer to enter into a formal agreement with the qualified custodian and further identifies specifications to be included in the agreement; (6) requires, within thirty (30) days of reporting, a custodian to deliver in its native form to the qualified custodian any digital assets that are abandoned and able to be transferred; (7)requires a custodian to report to the qualified custodian digital assets that are not able to be transferred and maintain the digital assets until transfer is possible; (8) requires the custodian to provide a proof of delivery to the treasurer within thirty (30) days of delivery; (9) requires the qualified custodian to maintain the digital asset in its native form for a minimum of two (2) years from transfer to the qualified custodian; (10) requires the qualified custodian to notify the treasurer that the digital asset is eligible for sale after the two (2) year hold period; and (11) requires the treasurer to sell digital assets at the prevailing market price of the digital asset at the time of sale or where there is no prevailing market price, by any commercially reasonable method.

CALIFORNIA: Amended AB 1501 which now (1) provides definition for “digital account holder”, “digital asset”, “private key”, and “qualified custodian”; (2) provides that property in a digital asset account is abandoned three (3) years after the date a written or electronic communication was returned as undeliverable or of the last account activity if owner did not receive communication; (3) defines “exercise of an active of ownership interest” as conducting a transaction regarding the digital asset account, electronically accessing the digital asset account, conducting activity in a different digital asset account owned by owner with same holder, and taking any other action that reasonably demonstrates to the holder that the owner knows the property exists; (4) requires, within thirty (30) days of reporting, a custodian to deliver in its native form to the qualified custodian any digital assets that are abandoned and able to be transferred and to further provide proof of delivery; (5) requires the holder to maintain the digital asset where the holder possesses only a partial private key and is unable to transfer the digital asset until the digital asset can be transferred; and (6) requires the controller to select a qualified custodian by January 1, 2027 and outlines the evaluation criteria for purposes of selecting the qualified custodian. 

With The Unclaimed Property Legislative Alert Summary of Legislation and Regulation, you receive an overview of the latest information on unclaimed property legislative updates, regulatory changes, and statutory amendments across the United States and Canada. The publicly available information contained herein has been compiled by Kelmar Associates, LLC and does not constitute legal advice or analysis of any kind.  The summary information is generally compiled on a weekly basis, as applicable, and is shared on Kelmar's website each month. For more information, please refer to each state unclaimed property bill.