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Senate Passes Bill That Would Ban Crypto Kiosks in Minnesota
Earlier this session, legislators heard from law enforcement and regulators who say the ATM-like machines are increasingly used to facilitate fraud.
On April 9, the Minnesota Senate passed SF 3868, a bill that would ban crypto kiosks in the state.
Sponsored by Sen. Amanda H. Hemmingsen-Jaeger (DFL-Woodbury), the measure would prohibit anyone from placing or operating a virtual currency kiosk in Minnesota. It passed 57-10 after a lengthy debate, withstanding several attempts to add other fraud-prevention provisions and a motion to send the bill back to the Senate Commerce and Consumer Protection Committee.
Following Senate passage, the bill was received by the House, where it will be compared with its House companion, HF 3642, sponsored by Rep. Erin Koegel (DFL-Spring Lake Park), and await further consideration.
Previous hearing and testimony
On Feb. 26, the House Commerce Finance and Policy Committee heard the House version of the bill and laid it over for possible inclusion in a larger omnibus bill.
During the hearing, committee members heard testimony from local law enforcement, including investigators from St. Cloud and Woodbury. The committee also received letters from the Benton County sheriff and the Faribault police chief describing the kiosks as a common tool used to defraud vulnerable residents, particularly seniors. One law enforcement official called the machines a “primary vehicle for financial exploitation.”
Industry representatives testified about safeguards they say have been implemented to prevent fraudulent transactions. The Minnesota Department of Commerce told the committee that steps taken by kiosk operators, along with legislation passed last year, have not been sufficient to prevent ongoing misuse.
In closing remarks, committee co-chair Rep. Tim O’Driscoll (R-Sartell) said lawmakers must continue working to protect residents from fraud but suggested the proposal before the committee may not be the right solution.
Read more about virtual currency kiosks in the Jan-Feb issue of Minnesota Cities magazine: “When City Codes Meet Cryptocurrency Kiosks: The New Frontier of Local Regulation.”