tl;dr
Nebraska Governor Jim Pillen signed bipartisan legislation, LB 609, to regulate digital asset ATMs, aiming to combat fraud and protect users. The law requires operators to be licensed, provide transaction limits, and implement fraud prevention measures. This move comes after U.S. Senator Dick Durbin...
Nebraska Governor Jim Pillen signed bipartisan legislation, LB 609, to regulate digital asset ATMs, aiming to combat fraud and protect users. The law requires operators to be licensed, provide transaction limits, and implement fraud prevention measures. This move comes after U.S. Senator Dick Durbin proposed federal legislation to prevent crypto ATM fraud, including warnings to consumers and additional protections for new customers.
On March 12, the Republican governor of Nebraska, Jim Pillen, signed legislation to protect against digital asset fraud, particularly in relation to digital asset ATMs. The bill, titled LB 609, was introduced on January 22 by Nebraska State Senator Eliot Bostar. The bipartisan and “law-enforcement-supported” legislation establishes the ‘Controllable Electronic Record Fraud Prevention Act’ to help combat fraud and protect users of digital asset kiosks and ATMs.
As of March 13, the United States hosted 29,795 digital asset ATMs, which represents 79% of all machines worldwide; currently, 37,719 digital asset ATMs are active globally. According to the Federal Trade Commission (FTC), victims in the country lost over $65 million to digital asset ATM fraud in the first half of 2024 alone. “Fraud losses at BTMs (Bitcoin ATMs) are skyrocketing, increasing nearly tenfold from 2020 to 2023,” said the FTC in September 2024.
On February 25, Democrat Senator Dick Durbin proposed legislation to reduce fraud at digital asset ATMs across the country. Speaking from the Senate floor, Durbin recounted the story of one of his Illinois constituents who had been scammed by someone claiming authorities had issued a warrant for his arrest. The fraudster claimed the man could “pay the fine” through a $15,000 deposit at a digital asset ATM to avoid jail. The Illinois Senator said the scam indicated an “alarming trend of crypto ATM fraud.”
The proposed 'Crypto ATM Fraud Prevention Act' would require digital asset ATM operators to provide clear warnings to consumers about the risk of fraud, including warnings of common types of scams and the fact that consumers should never send money to someone they have never met. ATM operators would be required to appoint a chief compliance officer and develop a comprehensive anti-fraud policy, to be submitted to the Financial Crimes Enforcement Network—a bureau within the U.S. Department of the Treasury that collects and analyzes information about financial transactions to money laundering, terrorist financing, and other financial crimes.
The legislation also proposed the requirement for digital asset ATM operators to register and disclose ATM locations, as well as a requirement for “sufficient” receipts and information to trace transactions. Durbin said criminals were using digital asset ATMs “to cheat Americans out of their hard-earned savings to the tune of $114 million in 2023 alone.” He added that “most of the victims are senior citizens.”