North Dakota lawmakers have debated a recently introduced bill seeking to limit crypto ATM transactions and introduce a slate of new regulations on the machines aimed at protecting residents from scams.
House Bill 1447, introduced to the state’s legislative assembly on Jan. 15, would limit crypto ATM customer withdrawals to $1,000 per day, cap fees to $5 per transaction or 3% of the total amount — whichever is higher — and require the machines to issue fraud warning notices.
North Dakota’s Department of Financial Institutions commissioner Lisa Kruse told members of the House Industry, Business and Labor Committee on Jan. 22 that the state’s residents filed 103 crypto scam complaints to the FBI for a combined loss of $6.5 million in 2023.
The FBI reported in September that Americans lost $5.6 billion due to crypto fraud in 2023 and recorded 5,500 cases that involved a crypto ATM resulting in losses of over $189 million.
The primary sponsor of the bill, House Representative Steve Swiontek, noted that crypto ATMs currently lack the protection measures that traditional money ATMs have — making it easier for perpetrators to scam victims.
“Unfortunately, this has allowed criminals to exploit them for theft,” Swiontek, who previously served as president and CEO of Gate City Bank, said at the hearing.
North Dakota House Industry, Business and Labor committee hearing on Jan. 22. Source: North Dakota Legislative Council
Josh Askvig, the state director of the American Association of Retired Persons, said the bill would create important consumer protections to save more elderly residents from having their hard-earned savings stolen.
Extract from the bill proposing how crypto ATM operators must warn their customers. Source: North Dakota Legislative Council
Along with requiring that crypto ATMs display a warning, the bill would also require the machines to advise users to contact law enforcement if they believe they’re being scammed and note that funds lost resulting from error or fraud may not be recoverable.
Crypto ATM operator CoinFlip’s assistant general counsel, Kevin Lolli, said at the hearing that the company supported the consumer protection side of the bill but opposed the fee and transaction limits.
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Crypto ATMs typically charge a fee between 8% and 20% to cover expenses involved with the hardware and maintenance, armored car services and rent payments to local businesses hosting the machines, Lolli told lawmakers.
Some crypto ATMs already report suspicious transactions of over $2,000 and transactions of over $10,000 to US authorities.
There are 37,155 crypto ATMs currently operating across 65 countries — though nearly 30,000 of those are based in the US, Coin ATM Radar data shows.
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