Virginia has introduced new legal requirements for the management of unclaimed cryptocurrency, mandating that digital assets deemed abandoned will be held by the state in their original form for at least one year before any sale can take place.
New law changes unclaimed crypto procedures
Governor Abigail Spanberger signed House Bill 798 into law on April 14. The legislation, set to take effect on July 1, 2026, updates Virginia’s unclaimed property statute to cover digital assets alongside other categories of property.
The law requires that any cryptocurrency in customer accounts that has been inactive for five years is considered abandoned and must be transferred to state custody. Unlike previous practices seen in many jurisdictions, these crypto assets will be transferred in-kind, meaning the actual tokens—not simply their cash value—are sent to the state.
Virginia, located on the U.S. East Coast, has actively updated its financial and technology regulations in recent years to accommodate new digital asset trends. Governor Abigail Spanberger, who took office in 2024, has prioritized modernization of state policy, including measures relating to responsible technology adoption and consumer protection.
Key compliance and investor protection provisions
The new regulation specifies that the state must keep digital assets for at least one year before liquidating them. During this window, rightful owners who reclaim their holdings can receive the original tokens if they remain unsold. If the state has already sold the assets, the claimant is entitled to either the sale proceeds or the current market value, whichever amount is higher at the time of the claim.
The statute identifies digital assets as representations of value functioning as a medium of exchange, unit of account, or store of value. Exclusions include in-game currencies and non-transferable reward points, which fall outside the regulation. The law also defines account activity; transactions, access, or any demonstration of account awareness reset the five-year dormancy period.
For institutions such as digital currency exchanges, compliance depends on their control over private keys linked to user assets. If the platform has full control, it must transfer tokens directly to state custody when required. If only partial control exists, the exchange must hold the assets until a complete transfer is possible, ensuring the assets are safeguarded throughout the process. In cases where the state cannot securely store certain assets, it is authorized to liquidate them for cash.
Industry reaction and implications for firms
The initiative has received a favorable response from the digital asset industry. Paul Grewal, chief legal officer at Coinbase, welcomed the law’s approach, pointing out its significance in safeguarding user interests.
Paul Grewal explained that the new law ensures digital assets remain in their native form during the state’s unclaimed property process, limiting the risk of users missing out on potential market gains if they recover their funds later.
Virginia is following a trend among U.S. states to modernize unclaimed property laws as cryptocurrencies become more mainstream. While states like California have also addressed unclaimed crypto, the specific approaches—including whether assets are sold or held in-kind—differ considerably across jurisdictions.
For crypto companies operating in Virginia, the change introduces stricter requirements for reporting, storage, and transfer of dormant assets, increasing compliance responsibilities in the rapidly evolving regulatory environment.
End users and investors are expected to benefit from stronger protections, reducing the risk that they lose out during market fluctuations and simplifying the process to reclaim dormant holdings.
