California legalizes bitcoin

The virtual currency bitcoin is now legal in California.

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Over the weekend, California Gov. Jerry Brown (D) signed into a law a bill that will allow businesses and individuals to use bitcoin in transactions.

The bill — from Democratic Assemblyman Roger Dickinson — repeals a state ban on using currency that is not “the lawful money of the United States.”

The Assembly's report on the bill notes the popularity of bitcoin — which "has gained massive media attention recently as the number of businesses has expanded to accept bitcoins for payment" — as well as the "frequent shopper" reward programs.

"Long before the introduction of digital currencies, various businesses have created points models that reward consumers with points for completion of various tasks such as spending a certain dollar amount, or even by purchasing points with dollars," the report said.

These point systems effectively operate as currency allowing the consumers to buy a retail item or pay for some type of service."

After the one-sentence bill passed the Assembly 52-11 last week, Dickson touted the bill as recognizing the popularity of virtual currency.

“In an era of evolving payment methods, from Amazon Coins to Starbucks Stars, it is impractical to ignore the growing use of cash alternatives,” he said in a statement.

“This bill is intended to fine-tune current law to address Californians’ payment habits in the mobile and digital fields.”