Nearly nine years ago, I observed that Section 107 of the California Corporations Code forbids a corporation, social purpose corporation, association, or individual from either issuing or putting in circulation "as money, anything but the lawful money of the United States". This prohibition, which was once included in Article XII, Section 5 of the 1879 California Constitution, even managed to survive its own repeal in 2014. See Why The General Corporation Law Still Prohibits The Issuance Of Money By Corporations.
Earlier this month, Assembly Member Jordan Cunningham introduced legislation, AB 2689, to allow private and public entities to accept virtual currency as a method of payment "[n]otwithstanding Section 107 of the Corporations Code". The bill would define "virtual currency" as "a digital representation of value that functions as a medium of exchange, unit of account, or store of value, and is often secured using blockchain technology".
Although Bitcoin was reportedly birthed in 2008, I could find no reference to bitcoin in a published decision of California court before Justice Margulies' opinion in Archer v. Coinbase, Inc., 53 Cal. App. 266 (2020).
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
