A Clearer Rulebook for Digital Assets in Public Office
California has taken a thoughtful—but firm—step toward modernizing ethics law. On July 30, 2025, AB 1029 was officially chaptered into law, amending the state’s landmark Political Reform Act of 1974 to require public officials to disclose digital asset holdings worth $2,000 or more.
Starting January 1, 2027, cryptocurrencies and other “digital financial assets” must be disclosed on Form 700 (the Statement of Economic Interests) by elected officials and public employees who make or influence governmental decisions, placing them on equal footing with traditional assets like stocks and real estate.
What AB 1029 Does—and Why It Matters
Expands the Definition of “Investment”
Until now, California’s ethics rules treated crypto as something outside the traditional category of “investment.” AB 1029 closes that gap by expanding the definition to include digital financial assets, whether held directly or indirectly. In practice, this means crypto is no longer in a gray area—it’s recognized alongside stocks, bonds, and other financial interests.
Makes Crypto Disclosure Mandatory
Public officials—including candidates, elected representatives, and staff covered under conflict-of-interest codes—will now have to list their crypto holdings on Form 700. This isn’t just about paperwork; it ensures decision-makers can’t quietly benefit from policies that affect the value of their tokens. For the crypto industry, this represents a new level of transparency in how policy is shaped.
Updates Conflict-of-Interest Rules
With crypto added to the reporting list, agencies must revise their conflict-of-interest codes to capture digital assets. This keeps ethics policies current with the realities of modern finance and prevents digital holdings from slipping through outdated definitions. The update signals that California sees crypto not as an outlier, but as a legitimate—and potentially influential—asset class in governance.
A New Legal Stake
Failing to disclose an investment has always been risky under the Political Reform Act, but AB 1029 raises the stakes and removes all doubt for those holding digital assets. Omission isn’t just a technical oversight; it could now carry misdemeanor-level consequences. The specific and direct inclusion of digital assets underscores the seriousness with which California expects officials to treat crypto interests moving forward.
“AB 1029 is a watershed moment for California. By requiring public officials to disclose digital assets alongside stocks and real estate, the state is recognizing crypto as a legitimate part of modern wealth. Transparency is vital to building public trust, and treating crypto holdings with the same standards as traditional assets helps normalize this technology while ensuring accountability from those in positions of power.”
— BitAML Founder & President, Joe Ciccolo
What It Means for Crypto Startups & Advisors
When the law was signed, the reaction across the industry was largely supportive. For entrepreneurs, exchanges, trading platforms, and kiosk operators, the takeaway was clear: crypto is finally being treated like other investments. That’s a milestone toward mainstream legitimacy—but it also raises new questions about what these changes might mean for day-to-day business strategy and compliance.
AB 1029 isn’t a sweeping consumer-protection regime or a licensing framework it’s a targeted ethics measure. Here’s what that looks like in practice:
- Crypto Is Getting Normalized: Digital assets now share the same reporting lane as stocks and bonds. This levels the playing field and reinforces the idea that crypto isn’t an experimental corner of finance—it’s part of the standard mix regulators and investors expect.
- Governance Is Getting Smarter: By requiring disclosure, AB 1029 ensures that public officials’ crypto interests are visible and accountable. For the industry, this means fewer blind spots in policymaking and a stronger foundation of trust between lawmakers and the businesses they regulate.
- Policy Is a Partner, Not an Enemy: Instead of a separate complex or adversarial framework, California is weaving crypto into existing law. That approach reflects a willingness to adapt old frameworks to new technologies, creating space for businesses to operate with more clarity and predictability.
- Practical, Not Overbearing: AB 1029 doesn’t burden startups with new compliance costs or reporting regimes. Instead, it integrates digital assets into existing ethics processes for elected officials and policymakers—a measured step that signals seriousness about transparency without disrupting innovation.
Key Context of AB 1029 and the Bigger Picture
AB 1029 is not the only crypto-related policy California has advanced:
- AB 1180 would permit government agencies to accept crypto payments. The bill has been placed on a two-year cycle, so policymakers and regulators can talk through this potentially groundbreaking bill when the legislature returns to session in 2026.
- SB 822 would designate unclaimed digital assets as property that must be reported and transferred to the California State Controller in their native crypto form, rather than first being liquidated into cash.
- The Digital Financial Assets Law (DFAL), effective July 2025, introduces licensing and compliance requirements for crypto businesses in California. The California Department of Financial Protection and Innovation (DFPI) continues to engage in rulemaking, soliciting public comment and reaching out to crypto innovators, industry stakeholders, and consumer advocates.
Together, these measures reveal a strategy: normalize crypto in governance (AB 1029), enable its use in government transactions (AB 1180), safeguard unclaimed crypto assets in their native form (SB 822), and regulate its purchase, sale, and exchange (DFAL).
For more on how AB 1029 fits into California’s policy journey, see California’s 2024 Crypto Regulatory Recap, our deep dive into DFAL and the DFPI’s proactive rulemaking.
Practical Steps for the Crypto Industry
For crypto businesses, investors, and advisors:
- Stay informed—don’t wait until 2027 to consider what AB 1029 means for you.
- Engage with policymakers—as Joe’s leadership in CBAC shows, industry voices shape better laws.
- Prepare your teams—your advisors and compliance staff should understand how disclosure rules may affect lobbying or partnerships.
- Play the long game—normalization through transparency today supports stronger, more sustainable growth tomorrow.
In Summary
AB 1029 brings overdue clarity to the role of crypto in public governance. It doesn’t stifle innovation—it scaffolds integrity. By requiring disclosure, California is signaling that crypto is not fringe finance—it’s part of the mainstream.
For startups, exchanges, and advisors, the message is clear: transparency is the new table stakes.
Ready to Navigate AB 1029 Ahead of 2027?
If you’re building a crypto business—or advising one—and want to understand how AB 1029 positions you in California’s policy environment, let’s talk. Book a discovery call with BitAML and chart a compliance-first strategy for this new era of transparency.
