Delaware and New Jersey Move Forward With Bills to Ban Crypto ATMs

Legislators in Delaware and New Jersey have moved forward with proposals that would impose a complete ban on cryptocurrency ATMs. Such a restriction has so far been adopted by only three states across the United States.

Delaware and New Jersey have each moved legislation forward to prohibit cryptocurrency ATMs, reflecting a broader trend emerging across several US states. Lawmakers argue that these machines are frequently exploited in fraudulent schemes and are often associated with scam-related activity.

On Tuesday, the Delaware House Economic Committee advanced House Bill 441 to the full House for further consideration. The measure would prohibit individuals and businesses from owning, installing, or operating cryptocurrency kiosks within the state.

The move came after the New Jersey Senate Commerce Committee unanimously approved similar legislation on Monday, advancing the proposal that would prohibit crypto ATMs to the full Senate for further debate and consideration.

At least three US states — Indiana, Tennessee, and Minnesota — have enacted comprehensive bans on cryptocurrency ATMs, citing concerns that the machines are frequently exploited in fraud schemes and other scam-related activities.

The FBI reported in May that it received nearly 13,500 complaints linked to cryptocurrency ATMs in 2025, with reported losses surpassing $388 million. The figures reflected a 23% rise in complaints and a 58% jump in financial losses compared with 2024. More than half of the reports were filed by individuals over the age of 50, who accounted for losses exceeding $302 million.

Cyndie Romer, the Delaware lawmaker who introduced the measure, argued that cryptocurrency ATMs transform digital assets into what she described as a predatory mechanism for extracting cash from consumers.

She added that most experienced cryptocurrency users avoid crypto ATMs because the machines often charge significantly higher fees, which can exceed 20% of a transaction’s value, compared with roughly 0.4% to 1% on online trading platforms. She argued that there is little justification for supporting a business model that allows fraudsters to target and extract funds from vulnerable individuals.

Delaware’s proposed legislation would also prohibit fiat-to-crypto transactions that effectively replace or mirror the functions of cryptocurrency ATMs, including services offered through point-of-sale terminals or cashier-assisted systems. The measure further requires operators to remove all existing crypto ATMs within 90 days after the law takes effect.

The legislation sets penalties of up to $10,000 for each violation. If authorities discover an operating kiosk, the operator must reimburse all fees collected from customers or contribute the equivalent amount to a consumer protection fund when affected users cannot be located.

New Jersey’s proposed measure would likewise prohibit individuals or businesses from owning, operating, installing, managing, marketing, or offering cryptocurrency ATMs for sale. Lawmakers cited a sharp increase in fraud cases linked to these machines as the primary reason for advancing the restriction.

The proposal sets financial penalties of up to $10,000 for an initial violation, while repeat offenses could result in fines reaching $20,000.

Bitcoin ATM Operators Push Back Against Proposed Restrictions

Indiana became the first state in the United States to prohibit cryptocurrency ATMs after legislation was signed in March. Tennessee adopted a similar restriction in April, and Minnesota later approved its own ban in May, extending the trend to additional states.

Several US cities have already approved, or are currently considering, ordinances that would prohibit cryptocurrency ATMs. Meanwhile, a number of states, including Arizona and California, have introduced limits on the maximum transaction amounts that users can process through these machines.

Bitcoin Depot, which previously operated more than 9,000 kiosks and was regarded as the world’s largest crypto ATM provider, pointed to increasing regulatory challenges as a key factor behind its bankruptcy filing last month.

However, crypto ATM providers have consistently argued that they should not be held responsible for scams carried out through their machines. Many operators have introduced on-screen fraud alerts and voluntary transaction caps in an effort to reduce illicit activity and protect users from potential schemes.

Bitcoin Depot told an ICIJ investigation into cryptocurrency-related scams in December that the company should not be considered responsible for crimes committed by third-party fraudsters. The operator also stated that it maintains extensive warning systems and protective measures on its kiosks and throughout the transaction process.