It’s a little-known fact that state governments often find themselves holding onto money that belongs to residents for long periods of time, and that those residents can claim that property whenever they want.
Now, one company is offering technology to help states do that with cryptocurrency such as Bitcoin, Litecoin or Ethereum.
When a person’s financial account has been inactive for a certain period of time, for example because they forgot it exists, or they moved and didn’t leave a forwarding address, state laws require the institution that holds the account to report and transfer the assets to the state. Usually the state controller’s office or treasurer’s office handles this. The state then tries to return the assets to the owner, which means those agencies need ways to manage funds from bank accounts, stocks, mutual funds, insurance policies, cash and most other forms of wealth. Avenu Insights & Analytics, a Virginia-based company that makes software for this work, has added cryptocurrency to that list.
Avenu announced in a news release this month that its portfolio of software tools for managing unclaimed assets can now receive, deliver out, liquidate, purchase and hold the most widely used types of cryptocurrency or digital currency. Bitcoin dates back to 2009, and while most governments have yet to start using cryptocurrencies themselves, David Lemoine, Avenu’s managing director of finance solutions, said states have been asking for a way to deal with them.
“There has been a growing demand from state clients, and it’s part of their mission to collect unclaimed property and make it available to the rightful owners, so the rightful owners can find it,” he said. “The states are getting a lot of inquiries, and therefore that’s created their interest in this solution. There’s something bubbling out there that is forcing the states to attend to this.”
Vilka Markovich, director of Avenu’s unclaimed property division, said the new function came out of a partnership in September with Gemini, a New York trust company that specializes in cryptocurrency exchange.
According to its news release, Avenu has worked with more than 3,000 state and local governments and manages more than $2 billion in unclaimed securities.
Often unrecognized as legal tender by governments, and therefore not controlled or regulated by them, cryptocurrencies have been creeping into the mainstream in recent years. Hawaii opened the door to cryptocurrency exchange platforms in August, political campaigns have been accepting them as donations, and PayPal announced in October that its users will be able to exchange cryptocurrencies on its platform.
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