States and cities move to restrict cryptocurrency ATMs amid fraud concerns

A Connecticut resident was duped by an online romance scammer into sending almost $150,000, much of it through cryptocurrency ATMs that later proved unrecoverable. Her experience, along with other reports of victims losing tens of thousands of dollars, has prompted a cascade of regulatory actions. Stillwater, Minnesota, was the first city to outlaw the kiosks in April 2025, and the ban was soon adopted by St. Paul and the state legislature.

According to AARP, roughly three dozen states now either ban or heavily restrict crypto ATMs. While some jurisdictions, like Hawaii, have limited only certain functions such as cash deposits, industry groups contend that outright bans merely shift fraud to other channels. Operators such as CoinFlip have offered to implement safeguards, including usage caps and refund windows, but many lawmakers remain unconvinced.