Minnesota lawmakers have introduced a bill to completely ban cryptocurrency kiosks—commonly known as crypto or Bitcoin ATMs—statewide, amid increasing fraud targeting elderly residents. Sponsored by Rep. Erin Koegel and known as House File 3642, the bill seeks to prohibit the operation of virtual currency kiosks across Minnesota, revoking the 2024 regulatory framework which included transaction limits and mandatory risk disclosures.
If passed, Minnesota would be among the first U.S. states to enforce such a ban. The proposal was prompted by testimony from law enforcement about scams using these kiosks, including “pig butchering” schemes where victims are tricked into transferring money to kiosks for fake investments or emergencies. Fraud cases often involve elderly victims losing significant savings, with scammers posing as trustworthy contacts.
The Minnesota Department of Commerce backs the bill, citing the insufficiency of current protections against sophisticated fraud. It argues that a ban is the most effective solution to eliminate this threat. Proponents of the ban highlight cases where the kiosks facilitated irreversible and hard-to-trace transactions, which scammers exploit.
Nationally, there’s a trend toward imposing more stringent controls on crypto kiosks, with other states and cities adopting various regulatory measures. However, industry representatives oppose outright bans, suggesting education and compliance improvements as better solutions.
The bill’s progress is being closely watched, as its passage could set a precedent for other states facing similar fraud issues, balancing the tension between digital finance innovation and consumer protection.