USDVirginia Law Requires In-Kind Custody for Unclaimed Crypto
New rules delay liquidation and set July 2026 effective date
TL;DR
- Virginia approved House Bill 798, now Chapter 669, to bring digital assets under the Virginia Disposition of Unclaimed Property Act.
- The law requires unclaimed crypto to be reported and remitted in-kind and bars liquidation for at least one year after the required report is filed.
- The measure takes effect July 1, 2026, and applies a five-year abandonment standard to digital financial asset accounts.
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Virginia approved a new unclaimed-property framework for digital assets that requires crypto to be held in-kind rather than automatically converted to cash, while delaying any liquidation for at least one year after the required report is filed. House Bill 798, now Chapter 669, was approved by Gov. Abigail Spanberger and is set to take effect on July 1, 2026.
The law brings digital assets under the Virginia Disposition of Unclaimed Property Act and creates a custody structure for handling unclaimed crypto. Under the final confirmed framework, property in a digital financial asset account is presumed abandoned after five years. Once reported, the assets are to be remitted in-kind, changing how the state handles property that later may be reclaimed by its owner.
That in-kind treatment is the central change in the statute. Rather than requiring immediate conversion to cash, the law allows digital assets to remain in their original form when they move into state custody. The bill also states that, after the required report is filed, the administrator may direct liquidation of reported but unremitted digital assets only “not less than one year” later.
Custody framework and owner recovery
The law also sets out how the state may manage those holdings. The bill text says the administrator may select one or more custodians for the management and safekeeping of digital financial assets. It also says a holder may transfer digital assets to a state-owned account held by the holder before liquidation, adding an administrative mechanism for custody before any sale is directed.
For owners, the practical effect is that later recovery can involve the actual crypto rather than a cash amount based on an earlier sale. That change addresses the problem of abandoned digital assets being liquidated before a claimant comes forward, leaving the owner with proceeds instead of the original asset.
The statute also narrows what qualifies as a digital financial asset. The bill text says a “digital financial asset” does not include merchant loyalty or reward-program value that cannot be taken from the merchant or exchanged with the merchant for money. Reporting on the measure also noted exclusions for in-game currencies and certain regulated securities.
Virginia’s budget documents show the state expects implementation costs. The budget tied to House Bill 798 included a $120,000 second-year nongeneral fund appropriation for the Department of the Treasury to carry out the bill’s provisions.
Public statements and broader state context
Paul Grewal, Coinbase’s chief legal officer, publicly welcomed the change, writing, “Some good news out of Virginia,” and adding that the law “updates the state’s unclaimed property statute to cover digital assets and ensures they are escheated in-kind.”
The Virginia Blockchain Council also backed the measure. The group said the law was “an important step” that “helps modernize Virginia’s financial laws and signals the Commonwealth’s continued engagement with emerging technologies.”
The legislative record shows the bill as approved after enrollment, with reporting on the signing placing the development on April 14 and April 15, 2026. Taken together, the final confirmed state of the law is that Virginia did not adopt immediate liquidation of abandoned crypto. It adopted a framework that covers digital assets explicitly, applies a five-year abandonment standard, requires in-kind custody, and delays liquidation for at least one year.
FAQ
What does the law do?
It brings digital assets under Virginia’s unclaimed-property law and requires in-kind custody.
When does the law take effect?
The law takes effect on July 1, 2026.
When is property presumed abandoned?
Property in a digital financial asset account is presumed abandoned after five years.
How long must liquidation wait?
Liquidation may be directed only “not less than one year” after the required report is filed.
This article has been refined and enhanced by ChatGPT.
