Minnesota Moves to Ban Crypto Kiosks Over Fraud

TheNewsCryptoPublicado em 2026-02-27Última atualização em 2026-02-27

Resumo

Minnesota lawmakers are advancing a bill, House File 3642, to ban all cryptocurrency kiosks in the state. This action follows law enforcement testimony linking these machines to a significant increase in elder fraud cases. Officials cited instances where elderly victims lost substantial savings, with one individual sending half her monthly income to scammers. Despite 2024 regulations that imposed consumer protections like disclosure requirements and a $2,000 daily transaction limit, these measures were deemed insufficient to prevent fraud. The proposed ban targets physical kiosks but would not affect online cryptocurrency transactions. This move aligns with a broader national and international trend of increasing oversight on crypto kiosks due to fraud concerns.

Minnesota lawmakers are advancing legislation that would prohibit cryptocurrency kiosks across the state. The proposal follows testimony from law enforcement officials who linked the machines to a surge in elder fraud cases.

Representative Erin Koegel introduced House File 3642 earlier this week. The bill seeks to ban the placement and operation of any virtual currency kiosk in Minnesota. Lawmakers would repeal nearly two dozen statutory provisions that currently regulate the industry.

Koegel told the House Commerce, Finance, and Policy Committee that officers have identified kiosks as a prime tool for scammers targeting vulnerable residents.

Law Enforcement Details Elder Fraud Impact

Woodbury Police Detective Lynn Lawrence described cases in which elderly residents lost significant portions of their savings. One victim on a fixed income completed at least 10 Bitcoin transactions over six months. She sent roughly half of her monthly income to scammers.

Lawrence stated that the victim ultimately required assistance from adult protection services. The woman feared she would lose her housing due to the financial losses.

The Minnesota Department of Commerce reported 70 kiosk-related complaints last year, totaling $540,000 in reported losses. Approximately 48% of affected consumers received partial refunds, averaging 16% of the total loss.

Minnesota currently hosts about 350 licensed kiosks operated by eight to ten companies.

2024 Safeguards Deemed Insufficient

The state introduced regulatory laws in 2024 to control fraud. The laws required the operators to disclose that cryptocurrency is not legal tender and that the transaction is irreversible. The law also required a $2,000 daily limit for new customers and a full refund in specified fraud conditions.

It is now argued that the measures have not prevented scams. Sam Smith, government relations director at the Minnesota Department of Commerce, stated that prior consumer protection efforts have not delivered sufficient results.

House File 3642 would repeal the existing regulatory framework entirely. The ban applies specifically to physical kiosks. Residents would still retain access to online cryptocurrency transactions.

Wider National and International Crackdown

Minnesota’s plan is in line with the regulatory movement. In August, Illinois passed the Digital Asset Kiosk Act, requiring registration of operators, real-time customer support, and a maximum 18% transaction fee.

Globally, New Zealand introduced a country-wide ban on cryptocurrency ATMs in July 2025 as part of anti-money laundering regulations. In Australia, regulators have also moved to broaden their powers to control high-risk financial services, such as crypto kiosks.

Regulators are now recognizing crypto access points as possible sources of fraud. Some argue that education and regulation could be more effective than banning kiosks.

Minnesota lawmakers will continue debating the proposal in committee. If enacted, the state would join a growing list of jurisdictions tightening oversight of cryptocurrency kiosks in response to fraud concerns.

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Perguntas relacionadas

QWhy are Minnesota lawmakers proposing to ban cryptocurrency kiosks?

AMinnesota lawmakers are proposing to ban cryptocurrency kiosks because law enforcement officials have linked them to a significant increase in elder fraud cases, where scammers have used the machines to target vulnerable residents.

QWhat was the financial impact of kiosk-related fraud reported by the Minnesota Department of Commerce last year?

AThe Minnesota Department of Commerce reported 70 kiosk-related complaints last year, totaling $540,000 in reported losses.

QWhat specific safeguards did Minnesota introduce in 2024 to control crypto kiosk fraud, and why are they considered insufficient?

AIn 2024, Minnesota introduced laws requiring operators disclose that cryptocurrency is not legal tender, that transactions are irreversible, impose a $2,000 daily limit for new customers, and provide a full refund in specified fraud conditions. They are deemed insufficient because they have not prevented scams, according to testimony from the Minnesota Department of Commerce.

QHow does the proposed ban in Minnesota fit into a larger regulatory trend?

AMinnesota's proposed ban is part of a wider national and international crackdown. For example, Illinois passed the Digital Asset Kiosk Act with new registration and fee rules, New Zealand implemented a country-wide ban on crypto ATMs, and Australia is broadening its powers to control high-risk financial services like crypto kiosks.

QIf the ban is enacted, will Minnesota residents lose all access to buying cryptocurrency?

ANo, the ban applies specifically to physical kiosks. Residents would still have access to online cryptocurrency transactions.

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