Tennessee Bans Crypto ATMs, Georgia Imposes Limits

Tennessee prohibited the operation and placement of cryptocurrency ATMs and kiosks across the state, and Georgia enacted rules that cap transfers, require fraud warnings at point of sale and impose reporting and refund obligations on operators. Both laws took effect Wednesday.

Tennessee’s law, signed by Governor Bill Lee in April, makes it illegal to place or operate crypto ATMs in the state. Industry data showed about 185 crypto ATMs and kiosks were operating in Tennessee before the ban. Operators will need to remove machines or stop providing service in the state.

Georgia’s law, effective the same day, does not ban machines. It requires operators to limit how much new and existing customers can send through ATMs, to display explicit warnings about fraud at the point of sale, and in defined cases to refund customers who were tricked into transferring funds. State regulators will oversee enforcement and may require reporting of suspicious transactions.

State officials said the measures respond to repeated fraud cases in which scammers used crypto ATMs to receive stolen payments, including schemes targeting older residents. Lawmakers who supported the restrictions cited those fraud complaints as a primary reason for the new rules.

Other U.S. states have moved similar policies. Indiana’s ban took effect in March and Minnesota is scheduled to enforce a prohibition on August 1. Lawmakers in Delaware and New Jersey have introduced bills that would ban crypto ATMs statewide. At the federal level in Canada, a proposal has been discussed that would prohibit crypto ATMs nationwide while allowing purchases of digital assets at licensed money-services businesses.

The changing regulatory environment has affected operators. In May, an ATM operator filed for Chapter 11 bankruptcy after warning of “substantial doubts” about its future amid legal and regulatory challenges. A restructuring adviser wrote, “The traditional model depended on high transaction spreads and limited regulatory scrutiny to offset unusually high compliance, cash logistics, fraud remediation, and retail revenue sharing costs,” and added that new consumer protection rules are compressing fees, expanding operator liability for scam-related activity and raising expectations for transaction monitoring and reimbursement.

Officials in Tennessee and Georgia said the laws aim to reduce scams and protect residents, particularly older adults who have reported losing funds after being directed to use crypto ATMs.