Tennessee Bans Cryptocurrency Kiosks After $4 Million Scam Exposed

Tennessee has become the second state in the nation to ban cryptocurrency kiosks entirely after the Murfreesboro Police Department's Fraud Unit helped gather evidence for a law that took effect July 1.

The ban was approved by the Tennessee General Assembly and prohibits the operation of cryptocurrency ATMs statewide, with violators facing jail time and fines up to $2,500. The crypto ATM industry had requested a federal judge to temporarily block the law but was denied.

Tennessee Attorney General Jonathan Skrmetti defended the ban, stating that cryptocurrency kiosks are 'tools for scammers targeting vulnerable Tennesseans' and are rarely used for legitimate purposes.

The MPD's Fraud Unit had investigated scams that drained nearly $4.1 million from Middle Tennessee victims in just six months, with many cases involving scammers impersonating law enforcement officers to convince victims to withdraw cash from their bank accounts and deposit it into cryptocurrency kiosks.