Members of the state legislature in Minnesota, one of the midwestern states of the USA, introduced a new bill that aims to ban cryptocurrency ATMs (aka virtual currency kiosks) from operating throughout the state. The bill is considered one of the clearest steps taken recently among US states in this field.
Comprehensive Changes Are Envisaged in the Bill
If the proposal passed to the House becomes law, Section 53B of Minnesota law will be updated and no one will be allowed to establish or operate virtual currency kiosks within the state. In addition, the articles that currently contain definitions regarding cryptocurrency kiosk operators, virtual money transactions and customer transaction limits are also in question to be repealed.
Consumer Safety and Fraud Cases Are at the Focus of Discussion
While investigations and discussions about cryptocurrency ATMs are gaining momentum across the USA, the risk of fraud and consumer safety concerns stand out in the background of the bill introduced in Minnesota. Virtual currency kiosks allow users to easily buy and sell digital assets such as Bitcoin with cash or debit card and generally operate with a simpler verification process than centralized exchanges.
The current legal regulation in force in Minnesota has some provisions regarding licensing requirements for kiosk operators, information, transaction limits and consumer protection. Issues such as kiosk control, exchange activity, wallet address definition and customer rights are also defined in detail. The new bill envisages removing all these regulations and switching from licensed regulation of the sector to a direct ban.
In addition, with the proposed change, the rules regarding the 72-hour transaction initiation period determined according to the distinction between old and new customers will be completely abolished.
The Bill May Also Affect Broader Digital Asset Regulations
The proposal in Minnesota rolls back not only cryptocurrency ATMs but also a significant portion of the state’s overall virtual currency regulations. Many regulations, including sections 53B.70 to 53B.75, will be excluded from the scope, such as licensing of crypto assets, customer information, storage obligations and users’ rights on digital assets. These provisions are consistent with structures currently in place across U.S. states in regulating the electronic transfer of funds.
Another noteworthy element is the examples given by law enforcement authorities that especially elderly people in the state are exposed to high-amount frauds through cryptocurrency kiosks. In the statements presented in the parliament, it was emphasized that some victims lost tens of thousands of dollars through kiosks and that fraudsters could easily bypass existing security measures.
On the other hand, while the Minnesota administration is discussing these prohibitive steps, it has also joined the states that are considering encouraging crypto investments. This interest is attributed to the crypto-friendly political environment following US President Donald Trump’s return to office.
