Chapter 9 - Digital Financial Asset Transaction Kiosks

California Financial Code — §§ 3901-3907

Sections (6)

Added by Stats. 2023, Ch. 871, Sec. 1. (SB 401) Effective January 1, 2024.

For purposes of this division:

(a)“Charges” means either of the following:

(1)Fees or expenses paid by the customer.

(2)The difference between the current market price of the digital financial asset on a licensed digital financial asset exchange and the price of the digital financial asset charged to the customer.

(b)(1) “Digital financial asset transaction kiosk” means an electronic information processing device that is capable of accepting or dispensing cash in exchange for a digital

financial asset.

(2)As used in this subdivision, “cash” means physical United States currency, both coins and paper currency.

(c)“Licensed digital financial asset exchange” means a digital financial asset exchange that is not an operator and has either of the following:

(1)A license to conduct virtual currency business activity in this state or the State of New York pursuant to Part 200 of Title 23 of the New York Codes, Rules and Regulations.

(2)A license pursuant to this division.

(d)“Operator” means a person who owns, operates, or manages a digital financial asset transaction kiosk located in

this state.

§ 3902

Added by Stats. 2023, Ch. 871, Sec. 1. (SB 401) Effective January 1, 2024.

An operator shall not accept or dispense more than one thousand dollars ($1,000) in a day from or to a customer via a digital financial asset transaction kiosk.

§ 3904

Added by Stats. 2023, Ch. 871, Sec. 1. (SB 401) Effective January 1, 2024.

On or after January 1, 2025, an operator shall not collect charges, whether direct or indirect, from a customer related to a single digital financial asset transaction that exceed the greater of the following:

(a)Five dollars ($5).

(b)Fifteen percent of the United States dollar equivalent

of digital financial assets involved in the transaction according to the publicly quoted market price of the digital asset on a licensed digital financial asset exchange at the time the customer initiates the transaction.

§ 3905

Added by Stats. 2023, Ch. 871, Sec. 1. (SB 401) Effective January 1, 2024.

(a)(1) On or after January 1, 2025, before a digital financial asset transaction, an operator shall provide a written disclosure in English and in the same language principally used by the operator to advertise, solicit, or negotiate with a customer containing the terms and conditions of the transaction, which shall include, at a minimum, all of the following:

(A) The amount of a digital financial asset involved in the transaction.

(B) The amount, in United States dollars, of any fees, expenses, and charges collected by the operator.

(C) The United States dollar price of the digital financial asset that is charged to the customer and the United States dollar price of the digital financial asset as listed by a licensed digital financial asset exchange.

(D) If an operator does not provide a method to reverse or refund a transaction, a warning that all transactions are final and cannot be undone.

(2)The disclosure required by this subdivision shall be clear and conspicuous and provided separately from any other disclosure provided by the operator.

(b)An operator shall provide a customer with a receipt for any transaction made at the operator’s digital financial asset transaction kiosk that includes all of the following information:

(1)The name of the customer.

(2)The date and time of the transaction.

(3)The name of the operator.

(4)The amount of a digital financial asset involved in the transaction.

(5)The amount of United States dollars involved in the transaction.

(6)The amount, in United States dollars, of any fees collected by the operator in relation to the

transaction.

(7)The amount, in United States dollars, of any spread between the United States dollar price of the digital financial asset that is charged to the customer and the United States dollar price of the digital financial asset as listed by a licensed digital financial asset exchange.

(8)The name of the licensed digital financial asset exchange the operator used to calculate the spread described in paragraph (7).

§ 3906

Added by Stats. 2023, Ch. 871, Sec. 1. (SB 401) Effective January 1, 2024.

(a)An operator shall provide to the department a list of all locations of digital financial asset transaction kiosks that the operator owns, operates, or manages in this state.

(b)An operator shall provide the department with updates to the list required by this section within 30 days of any changes.

(c)The department shall make the list required by this section for each operator available to the public on the department’s internet website.

§ 3907

Amended by Stats. 2024, Ch. 945, Sec. 6. (AB 1934) Effective January 1, 2025.

(a)On or after July 1, 2026, an operator shall comply with Section 3201 to the extent that the operator engages in digital financial asset business activity.

(b)If an operator does not engage in digital financial asset business activity but allows or facilitates another person to engage in digital financial asset business activity via a digital financial asset transaction kiosk that is owned, operated, or managed by the operator, the operator shall do all of the following:

(1)On or after July 1,

2026, ensure that the person engaging in digital financial asset business activity via the digital financial asset transaction kiosk has a license pursuant to this division.

(2)Ensure that any charges collected from a customer, whether collected by the operator, a person engaging in digital financial asset business activity via the digital financial asset transaction kiosk, or both, comply with the limits provided by Section 3904.

(3)Comply with all other provisions of this chapter.