Virginia has enacted a new framework for managing unclaimed digital assets, requiring the state to hold dormant cryptocurrency in its original form for at least 1 year before initiating any sale. Governor Abigail Spanberger signed House Bill 798 into law on April 14, with the measure taking effect on July 1, 2026.
The legislation updates Virginia’s existing unclaimed property statute to specifically address digital assets. Under the new rules, cryptocurrency held in customer accounts that show no activity for five years will be presumed abandoned and transferred to state custody.
In-Kind Custody Replaces Immediate Liquidation
Unlike prior practices in many jurisdictions, where states routinely convert dormant crypto into cash upon receipt, HB 798 mandates that assets be transferred “in-kind.” This means the state takes possession of the actual tokens rather than liquidating them immediately.
The Virginia Department of the Treasury may initiate a sale only after the one-year custodial holding period concludes.
The change addresses a long-standing concern among crypto users and industry firms. Under previous arrangements, if the original owners later claimed their property, they would receive only the cash equivalent from the date of sale, potentially missing out on substantial market appreciation.
Industry Response and Compliance Implications
Industry reaction has been favorable. Paul Grewal, chief legal officer at Coinbase, noted that the measure ensures digital assets are handled in a way that preserves their native form during the unclaimed property process. For crypto firms operating in Virginia, the law introduces new compliance requirements tied to reporting, custody, and transfer procedures.
Growing State-Level Momentum
Virginia joins a growing list of states moving to update unclaimed property laws to account for digital assets. States such as California have pursued similar reforms, though approaches vary regarding whether assets must be held in kind or liquidated. Ohio and Wyoming have also begun examining their own frameworks.
The Uniform Law Commission has reportedly begun preliminary discussions on creating a model act for states to follow, suggesting a potential shift toward standardized, crypto-aware regulations across the United States. For users, the Virginia law offers stronger protections against forced liquidation and a clearer path to reclaiming assets that fall into dormancy.
