Tennessee Bans Crypto ATMs Statewide

Tennessee Governor Bill Lee signed legislation on April 13 banning cryptocurrency automated teller machines, or ATMs, across the state, effective July 1. The measure, House Bill 2505, classifies owning or operating such kiosks as a Class A misdemeanor, punishable by up to 11 months and 29 days in jail and a $2,500 fine.

Lawmakers cited the machines' role in facilitating scams that primarily target older residents. Operators must remove the roughly 600 kiosks currently in Tennessee, many located in convenience stores, gas stations and liquor shops, particularly in Nashville. Supporters, including House Speaker Cameron Sexton and Representative Jay Reedy, described the devices as a direct pipeline for fraudsters who impersonate police, government officials or family members to pressure victims into depositing cash.

"Virtual currency kiosks have become a gateway for scammers to exploit Tennesseans, especially our seniors, with little hope of recovering their money once it's gone," Sexton said. Victims scan QR codes provided by scammers, converting cash to irreversible blockchain transfers. Cumberland County Sheriff Casey Cox told a House committee in March that his office and...