Minnesota Enacts Statewide Ban on Crypto ATMs Amid Rising Scam Concerns

Summary of Key Points:

• Ban Implementation: Minnesota’s crypto ATM ban took effect on August 1, 2026, following nearly $1 million in reported scam losses.
• Complaint Statistics: 134 complaints over three years led to significant financial losses, with 2025 alone seeing over $4 million in reported losses.
• Removal Deadline: All crypto kiosks must be offline by August 1, with public removal required by December 31, 2026.
• Legislative Action: Governor Tim Walz signed Senate File 3868 into law on May 5, 2026, after legislative approval.
• Scope of the Ban: The law prohibits the operation of crypto kiosks but does not restrict online transactions for digital assets.

Minnesota Enacts Statewide Ban on Crypto ATMs Amid Rising Scam Concerns

August 2, 2026

Minnesota has officially banned cryptocurrency ATMs, a move that took effect on August 1, 2026, following alarming reports of nearly $1 million in scam-related losses. The decision comes after the Minnesota Department of Commerce documented 134 complaints from residents over the past three years, highlighting the urgent need for regulatory action.

Governor Tim Walz signed Senate File 3868 into law on May 5, after it successfully passed through the state legislature. The new regulations require all crypto kiosks to cease operations immediately, with a deadline for physical removal set for December 31, 2026. This ban specifically targets machines that allow users to exchange cash, bank credit, or other cryptocurrencies for digital assets, while still permitting residents to buy, sell, or hold cryptocurrencies through legitimate online platforms.

A Growing Problem

The Minnesota Department of Commerce has been tracking the surge in crypto-related scams, particularly those involving kiosks. In 2025 alone, the department recorded 70 complaints, resulting in over $540,000 in reported losses. Victims often fell prey to schemes involving fake emergencies, romance scams, and impersonation of government officials, leading them to withdraw cash and use kiosks to send money to scammers.

Commerce Commissioner Grace Arnold issued a stark warning to residents: “If someone is telling you to act quickly and send money through a kiosk … it’s a scam.” Despite previous attempts to regulate the industry through licensing and transaction limits, scammers adapted quickly, exploiting loopholes to continue their fraudulent activities.

Broader Implications

The FBI’s data paints an even grimmer picture, revealing 222 complaints related to crypto kiosks in Minnesota in 2025, with total losses exceeding $4 million. These figures, while not directly comparable to state data due to differing reporting methods, underscore the widespread nature of the problem. Nationwide, the FBI reported over 13,000 kiosk-related complaints, amounting to nearly $389 million in losses, with a significant portion of victims being over the age of 50.

Minnesota’s ban aligns with a growing trend across the United States, as states like Tennessee and Indiana have already implemented similar restrictions. In contrast, Minnesota has also introduced a new law allowing banks and credit unions to offer crypto custody services, provided they adhere to stringent risk management and cybersecurity protocols.

Compliance and Enforcement

The Minnesota Department of Commerce is actively working with licensed money-service businesses to ensure compliance with the new regulations. Assistant Commissioner Sara Payne emphasized that the department has the authority to impose legal sanctions and civil penalties on operators who continue to offer kiosk transactions. Residents are encouraged to report any remaining operational machines.

As the deadline for removal approaches, operators must also ensure that customers are reimbursed for any outstanding transactions, either in U.S. dollars or through transfers to designated crypto wallets. The state is committed to monitoring compliance and will investigate any reports of non-compliance.

As Minnesota takes these significant steps to protect its residents from crypto scams, the focus now shifts to ensuring that the new regulations are effectively enforced and that consumers remain vigilant against potential fraud.