California continues to position itself as one of the nation’s most influential digital asset regulatory jurisdictions. The most immediate issue for many industry participants is implementation of California’s Digital Financial Assets Law (DFAL), which became operative July 1, 2026. Recent legislation and pending bills demonstrate California’s continued movement beyond exchange regulation toward a broader framework governing licensing, custody, anti-money-laundering enforcement, unclaimed digital assets, fiduciary access, public-integrity concerns, and the role of banks and credit unions in digital asset markets.
Recent legislation and pending bills also demonstrate an emerging federal-state realignment. Notably, SB 97 removes DFAL’s standalone stablecoin chapter while preserving California’s broader licensing and supervisory structure. At the same time, the failure of AB 2285, the Digital Financial Asset Banking Law (DFAB), highlights continuing disagreement regarding staking, custody, securities treatment, and bank participation in digital asset activities, issues likely to return in future legislative sessions.