Minnesota lawmaker proposes a bill to ban crypto kiosks statewide after rising fraud cases linked to crypto ATM scams.
Lawmakers in the United States are discussing a new rule about crypto machines. A proposal in the state of Minnesota may ban crypto kiosks completely. These kiosks provide the ability for people to purchase digital money with cash. The bill was introduced following reports of scams through the use of such machines.
The proposal was put forward by Erin Koegel. She introduced the bill at a meeting by the Minnesota House Commerce Finance and Policy Committee. The bill is called House File 3642. Lawmakers are still looking at it before coming to a final decision.
Crypto kiosks look similar to traditional ATMs. People can transfer cash and accept cryptocurrency into a digital wallet. However, scammers tend to abuse these machines, according to authorities. Therefore, lawmakers want to have stronger protection for residents.
Officials say that the technology behind kiosks is still new and lightly regulated. It is for this that criminals sometimes take advantage of it. Some lawmakers think eliminating the machines could prevent numerous cases of fraud.
Lawmakers Say Scammers Use Crypto Kiosks to Target Victims
The state law enforcement agencies shared their information about recent fraud cases. Many scams were perpetrated by victims who sent cryptocurrency through kiosks. Scammers often fool victims by phone calls or messages sent through the Internet.
Once they win your trust, criminals tell the victims to deposit money into crypto kiosks. Victims think that they are sending money to safe investments or helping relatives. Instead, the money goes directly to scammers.
Representative Koegel explained the seriousness of the issue. She said cryptocurrency transactions are usually irrecoverable. Once a person sends the money it is extremely difficult to recover.
Police officers from cities such as Woodbury and St. Cloud also testified. They said criminals often instruct victims to go to nearby kiosks. Victims then convert cash in digital currency and transfer it to scammers.
Government data indicates the problem is increasing. The Minnesota Department of Commerce had 70 kiosk-related complaints in 2025. These losses were approximately $540,000.
Many of the victims were elderly. Scammers tend to target seniors as they may be less familiar with digital technology. Therefore, lawmakers would like to minimise these risks.
New Bill Would Eliminate All Crypto Kiosks in Minnesota
The proposed law would completely ban the virtual currency kiosks throughout the state. If passed, no company could place or operate these machines in place anywhere in Minnesota. This rule would apply to all physical crypto kiosks.
The bill also would nullify a previous regulatory scheme introduced in 2024. That previous rule permitted the use of kiosks but imposed restrictions on their use. For example, for new users, a limit of only $2,000 was allowed per day.
The previous framework also had requirements for warning messages on kiosk screens. These warnings served to remind the users of potential scams. However, officials say scammers often get around such protections.
Some criminals ask victims to make several smaller transactions instead of one large payment. Still others direct victims to disregard warning messages that the machine displays. Because of this, regulators believe that current rules may not work effectively.
Importantly, the proposed ban would only cover physical kiosks. People in Minnesota were still able to buy and sell cryptocurrency online. Digital trading platforms and exchanges would not be illegal.
Several groups are in favor of the proposed ban. The Minnesota Department of Commerce and many local police departments believe that it will reduce fraud. They suggest that the removal of kiosks could prevent a lot of scams before they have started.
However, some companies do not agree with the proposal. Businesses such as CoinFlip and Bitcoin Depot are against a total ban. They believe better regulation would work better than the removal of the machines.
These companies state that kiosks give financial access to individuals who lack traditional bank accounts. They claim that a lot of users rely on kiosks to make digital transactions.
Currently there are about 350 licensed crypto kiosks in Minnesota. Some 8 to 10 companies operate these machines. If the bill became law, all of them would have to shut down.
Lawmakers held a discussion on the proposal on February 26, 2026. The committee decided to go further on the bill before voting. Therefore, the future of crypto kiosks in Minnesota is still unclear.