Tennessee Imposes Complete Ban on Crypto ATMs to Combat Fraud

On April 25, Tennessee Governor Bill Lee signed a bill that prohibits the operation of cryptocurrency ATMs statewide, making Tennessee the second state after Indiana to implement a comprehensive ban. The bill (HB 2505) has officially taken effect and will be enforced starting July 1. Under the regulations, the installation or operation of ‘virtual currency kiosks’ (i.e., Bitcoin ATMs) will be classified as a Class A misdemeanor, carrying a maximum penalty of one year in jail and a $2,500 fine. Additionally, merchants that allow these devices will also bear legal responsibility. Currently, most states in the U.S. have strengthened regulations through licensing systems and transaction limits, but comprehensive bans remain rare. Data shows that since 2026, 30 states have proposed related legislation, with 20 states having passed laws, indicating a continued tightening on the risks of fraud associated with crypto ATMs.

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