California's state legislature is holding a hearing today in
Sacramento about its Money Transmission Act—a sweeping reform of
financial regulations which caught a lot of payments startups in
its net since its passage in 2010.  The outcome could affect a
number of high-profile companies, from Square and Stripe to
eBay, Intuit, and Google—and even startups like Airbnb which
aren't classically thought of as financial in nature but could
fall under the law's broad definition of money transmission.
Commissioner Teveia Barnes, an experienced lawyer who has run
the Department of Financial Institutions since early last year,
told the State Assembly's Committee on Banking and Finance that
the law was needed to protect consumers.  "Money transmitters
are asking permission from the state to hold other people's
money—hundreds of thousands of dollars—for some period of time,"
she said. "I view the holding of other people's money in the
same vein as holding bank deposits and holding credit-union
deposits.... I don't consi