After hundreds of millions lost to fraud, NC lawmakers push for crypto ATM protections

North Carolina lawmakers on Tuesday advanced a bill to protect consumers from cryptocurrency kiosk fraud.

House Bill 920, which passed the House with a 115-to-0 vote, aims to regulate an industry that its author claims is unregulated in the state.

“It’s the wild, wild West,” Rep. Neal Jackson, R-Moore, said during a committee discussion on Tuesday. “There is no regulation whatsoever in North Carolina. That’s what we’re trying to do here.”

Lawmakers cited a growing amount of fraud as the reason for the bill. About $389 million in losses were reported last year through cryptocurrency ATMs, a 58% increase from 2024, according to the FBI. The majority of those impacted are 60-plus.

The bill now goes to the Senate for consideration. It seeks to:

• Require licenses for all kiosk operators under the Money Transmissions Act.
• Place operators under the supervision of the Commissioner of Banks.
• Require fraud warnings and transaction receipts for every transaction.
• Require compliance and consumer protection officers that are always available.

It also seeks to place limitations on transactions in an effort to reduce fraud, requiring a $2,000 daily limit for the first 30 days for new customers and a $5,000 daily limit for existing customers, who would qualify after 30 days.

While other states have service fees between 20% and 30%, Jackson suggests putting a cap at 14%.

State Rep. Tim Longest, D-Wake, expressed concern about having the kiosks at all in the state. He said the bill’s protections could be stronger. 

“These machines can be the subject of fraud, basically facilitating fraud on seniors and other vulnerable individuals and in those cases,” Longest said. “… In crafting regulations, I think it’s important that we ensure consumers are adequately protected by those regulations and I do not believe that, under the language of the bill currently before you, those regulations are sufficient to protect consumers.”

Jackson pointed to this bill as an effort to regulate, not shut down, cryptocurrency kiosks in the state and said there are even more consumer protections in place.

David N. Tente, the executive director of the ATM Industry Association, said the bill — and others like it — is problematic because it requires operators to provide refunds to fraud victims in certain instances.  

“In most cases, the cash in the ATM/kiosk does not belong to the operator, which means that returning any of it would be, technically, theft,” Tente said. “If you give someone cash for something, and you change your mind after they leave, you probably won’t get it back.”

He added: “We certainly feel sorry for those being scammed, but there are very simple things you can do to avoid it.”  

Tente said these kinds of scams have existed for centuries, adding: “They are still here — just using different means of payment.”