It’s a little-known fact that state governments often hold onto money that belongs to residents for extended periods and that those residents have the right to sue that property at any time.
One company is now providing technology to assist states in using cryptocurrencies like Bitcoin, Litecoin, and Ethereum.
State regulations require the entity that maintains a person’s financial account to record and transfers the assets to the state if the account has been inactive for a certain period, for example, because the person forgot it existed or because they moved and didn’t leave a forwarding address. This is usually handled by the state controller’s or treasurer’s offices. The state then attempts to reclaim the money, which necessitates systems’ creation to control funds from bank accounts, securities, mutual funds, insurance plans, cash, and most other types of capital. Cryptocurrency has been added to Avenu Insights & Analytics, a Virginia-based company that develops tools for this purpose.
In a press release issued earlier this month, Avenu confirmed that its suite of software resources for handling unclaimed assets will now obtain, send, liquidate, buy, and retain the most commonly used forms of cryptocurrency or digital currency. Although most governments have yet to begin using cryptocurrencies, David Lemoine, Avenu’s managing director of finance solutions, said states have been asking for a way to deal with them since 2009.
“There has been an increase in demand from state clients, and it is part of their task to collect unclaimed property and make it available to the rightful owners so that the rightful owners can locate it,” he said. “The states are receiving a large number of inquiries, which has piqued their interest in this solution. Something is brewing out there that is compelling the states to address this.”
The new feature stemmed from a September partnership with Gemini, a New York trust company specializing in cryptocurrency trading, according to Vilka Markovich, director of Avenu’s unclaimed property division.
According to the company’s press release, Avenu has partnered with over 3,000 state and local governments and manages more than $2 billion in unclaimed shares.
Cryptocurrencies have been creeping into the mainstream in recent years, even though they are mostly not recognized as legal tender by governments and therefore are not governed or regulated by them. In August, Hawaii made cryptocurrency trading platforms legal, and political campaigns have begun to embrace them as donations. In October, PayPal revealed that its customers would be able to exchange cryptocurrencies on its site.