Fidelity Pays $500,000 In California Crypto Withdrawal Settlement

California has secured a $500,000 settlement with Fidelity Digital Asset Services over restrictions that previously prevented some crypto customers from moving purchased coins to their own wallets. TL;DR: Attorney General Rob Bonta announced the settlement on October 16. California challenged historical withdrawal restrictions; Fidelity disputes that its conduct breached state law, and transfers were enabled after a 2025 regulatory approval. The issue is a straightforward one for anyone accustomed to self-custody: buying crypto through an app is not necessarily the same as being able to withdraw it. California’s commodity rules require certain transactions to involve physical delivery within a defined period. The state’s position is that delivery of cryptocurrency requires the buyer to be able to transfer the asset away from the dealer. Fidelity told investigators that it had been waiting for permission from the New York Department of Financial Services before allowing external withdrawals. That permission arrived in April 2025, at which point the company enabled the functionality. The state says the earlier restrictions were unlawful; Fidelity disputes that conclusion. The Califor