This isnt asset seizure at all. My state has a similar system already, it just doesn't do it for bitcoin or crypto yet.

Let's say I had a natural gas bill I was paying, but then I moved and there was a leftover balance on the account(I overpaid). They send me a check, but I didn't give them a new address...

Now they have money sitting in an account waiting for me. Eventually those funds are marked abandoned, and they are supposed to give it to the state government, there is a process by which I can claim those unclaimed funds from the state.

That's all this is, they extended their abandoned funds system to include crypto.