Crypto ATM Operators Face July 1 Deadline in Tennessee

TLDR

• Tennessee’s crypto ATM ban takes effect on July 1.
• Gov. Bill Lee signed House Bill 2505 on April 13.
• Operating or hosting a crypto kiosk will be a Class A misdemeanor.
• Tennessee had more than 570 crypto kiosks before the ban.
• FBI data tied crypto kiosks to over $389 million in 2025 losses.

Tennessee will ban cryptocurrency ATMs and kiosks statewide on July 1 after Gov. Bill Lee signed House Bill 2505 into law, making the installation, operation, or hosting of virtual currency kiosks a criminal offense under state law.

The measure was signed on April 13 and places Tennessee among the small group of U.S. states that have adopted a full ban on crypto kiosks. The machines, often located in gas stations, convenience stores, and shopping centers, allow users to buy or sell digital assets using cash and send funds to external wallet addresses.

Under the new law, violations will be treated as a Class A misdemeanor. Operators and businesses that allow crypto kiosks on their property could face penalties of up to 11 months and 29 days in jail, along with a fine of up to $2,500.

Tennessee Crypto Kiosk Ban Takes Effect July 1

House Bill 2505 prohibits the installation and operation of virtual currency kiosks across Tennessee. The law also extends responsibility to property owners and businesses that host the machines, meaning enforcement will not be limited to kiosk operators.

The bill passed both chambers of the Tennessee legislature unanimously before receiving the governor’s signature. State officials have framed the measure as a response to fraud cases involving cryptocurrency ATMs, particularly scams targeting older residents.

Tennessee House Speaker Cameron Sexton, who sponsored the bill, said virtual currency kiosks have been used by scammers to exploit residents and leave victims with limited options for recovering funds once transactions are completed.

Data from CoinATMRadar showed more than 570 crypto kiosks and ATMs in Tennessee as of Monday. Operators listed in the state include Bitcoin Depot and CoinFlip. Shares of Bitcoin Depot, which trades on Nasdaq, closed lower by about 6.9% on Monday.

Scam Concerns Drive State-Level Action

Crypto kiosks are legal financial tools, but law enforcement agencies have linked them to fraud schemes in which criminals direct victims to convert cash into cryptocurrency. Once transferred to a scammer-controlled wallet, the funds are often difficult to trace or recover.

Common schemes include impersonation scams, where criminals pretend to be police officers, government officials, debt collectors, or relatives in urgent need of help. Victims are often told they must send cryptocurrency to avoid arrest, pay a fake debt, or assist a family member.

The Federal Bureau of Investigation reported more than 13,000 complaints tied to crypto ATMs and kiosks in 2025. Those complaints were connected to more than $389 million in reported losses. Older Americans accounted for a large share of victims in kiosk-related fraud cases.

The broader category of cryptocurrency and artificial intelligence-related scams was among the costliest forms of internet crime reported by Americans in 2025. State lawmakers have responded by advancing bills aimed at reducing the use of kiosks in fraud networks.

Other States Weigh Crypto ATM Restrictions

Tennessee is the second U.S. state to enact a full statewide ban on crypto ATMs, following Indiana. Other states have taken narrower approaches, including licensing requirements, daily transaction caps, fraud warnings, waiting periods, and refund rules for certain scam victims.

AARP has tracked a rise in state legislation related to crypto kiosks, with dozens of bills introduced in 2026. By this year, 20 states had passed laws addressing virtual currency kiosks in some form.

Minnesota lawmakers recently advanced a bill that could ban crypto kiosks statewide, while a Massachusetts town approved a local ban earlier this month. The measures reflect growing attention to how cash-to-crypto machines are used in consumer fraud.

Tennessee’s law gives operators and host businesses only weeks to remove machines or stop offering kiosk access before enforcement begins. The July 1 effective date will mark a new phase for crypto ATM regulation in the state, with criminal penalties replacing licensing-based oversight.

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