Minnesota Becomes First State to Ban Cryptocurrency Kiosks Over Elder Fraud
Governor Tim Walz signed S.F. 3868 into law, ordering removal of roughly 350 machines by year's end.
A Statewide Ban Takes Shape
Minnesota has become the first state to ban cryptocurrency kiosks outright. Governor Tim Walz signed S.F. 3868 into law on May 5, 2026, prohibiting digital currency ATMs statewide and marking a significant escalation in how regulators treat crypto infrastructure linked to financial scams.
The ban takes effect August 1, 2026, with existing kiosks required to be removed by December 31, 2026. Approximately 350 licensed machines currently operate across Minnesota, managed by eight to ten companies, according to the state Department of Commerce.
Elder Fraud Drives the Legislation
Lawmakers cited a surge in scams targeting older adults as the primary justification. Adults aged 60 and older accounted for 86% of reported losses in cryptocurrency kiosk fraud cases where the victim's age was known, based on FBI and AARP data.
During legislative hearings, law enforcement officials testified that seniors were increasingly coerced into using these machines to send funds to scammers. Unlike online transfers, kiosk transactions are difficult to reverse and often anonymous, making recovery nearly impossible once completed.
Cryptocurrency kiosks are typically located in high-traffic retail venues such as gas stations and convenience stores. Consumer advocates argue they serve as the "last mile" in social engineering schemes, including pig-butchering scams, where victims are directed to physical machines to finalize fraudulent transactions.
Industry Pushback
Crypto industry representatives contested the scope of the problem. Jon Turke, director of government affairs for CoinFlip, which operates kiosks nationwide, noted that less than 3% of all money lost in cryptocurrency scams occurred at kiosks, with over 97% lost through online portals.
"The vast majority of crypto scam losses happen elsewhere," Turke said, suggesting the ban targets a small fraction of the overall fraud landscape while eliminating a legitimate financial service for Minnesotans.
A Regulatory Signal
Minnesota's move signals a growing regulatory trend in the U.S. to treat cryptocurrency kiosks as high-risk vectors for financial crime rather than neutral financial tools. By banning the physical infrastructure, the state is attempting to disrupt the final step in scam operations where victims convert cash to digital currency under pressure.
FBI figures on total crypto kiosk scam losses vary across sources, with estimates ranging from $333 million to $389 million for 2025 nationwide. The discrepancy reflects different reporting periods and methodologies, but all sources agree the losses represent a significant and growing problem.
Consumer protection groups have praised the legislation as a necessary intervention. AARP Minnesota, which advocated for the ban, framed it as protecting vulnerable populations from rapid, irreversible financial harm.
The law's implementation timeline gives operators roughly eight months to cease operations and remove hardware. Compliance enforcement will fall to state financial regulators, who have not yet detailed penalties for violations.