Hawaii Bans Crypto Kiosk Deposits as Scams Skyrocket

Hawaii has become the first state to ban cryptocurrency ATM deposits in an effort to combat scammers who exploit these machines to defraud victims. The new law takes effect on October 1, making it impossible for consumers to deposit cash into kiosks to buy cryptocurrency. However, those with existing accounts can still convert their crypto into cash and make withdrawals.

The state's decision was prompted by FBI data showing $3.85 million in losses through fraud involving cryptocurrency kiosks in 2025, nearly four times the amount reported the previous year. This surge in scams has led lawmakers to implement stricter consumer protection measures, including a ban on deposit-taking kiosks.

Hawaii Banking Commissioner Dwight Young explained that scammers target vulnerable individuals, often using unsolicited phone calls or text messages to convince them to withdraw cash from their bank accounts and deposit it into the ATMs. Once the money is in the machine, it's gone.