Minnesota Bans Crypto ATMs to Combat Scams

Minnesota is set to prohibit cryptocurrency ATMs to curb scams that have cost residents nearly $1 million. These machines, which allow cash to be converted into digital currency quickly, have become a favored tool for scammers. The ban takes effect on August 1, 2026. By the end of 2025, operators must remove publicly accessible machines.

Scammers Exploit Speed of Crypto Kiosks

Cryptocurrency kiosks provide a quick cash-to-crypto conversion, making them appealing to scammers. State officials report that scammers pressure victims during emergencies or fake threats, prompting them to use these machines. Victims often act before family or authorities can intervene, which is precisely what criminals rely on.

Complaints and Losses

Between 2023 and 2025, Minnesota registered 134 complaints about crypto kiosk scams. Losses nearly hit $1 million, with 70 cases reported in 2025 resulting in losses exceeding $540,000. These numbers likely represent only a portion of the issue, as many victims do not report due to embarrassment or fear of judgment.

Why Crypto ATMs Are Problematic

Crypto kiosks pose a unique challenge for recovering funds due to the rapid nature of digital currency transfers. Once currency is moved from a wallet, it can cross borders or change wallets quickly, making it difficult to trace.

How Scams Occur

The scam generally begins with a pressure-inducing call. Scammers may pretend to be law enforcement, claiming the victim missed jury duty, or pretend a family member is in trouble. They then guide the victim to withdraw cash and complete a transaction at a kiosk.

Case Studies

Gail Barr lost $9,260 after a scammer convinced her she missed jury duty. Another scam involved an 85-year-old man losing $200,000 in a fabricated PayPal refund scam. Joe Allen, a disabled man, lost over $300,000 through a cryptocurrency investment scam. These cases highlight how scammers manipulate fear and trust.

Nationwide Issue

Minnesota is not alone in tackling this problem. In 2025, the FBI’s Internet Crime Complaint Center received over 13,400 complaints involving crypto kiosks, with total losses over $388 million. A significant number of cases involve individuals over 50, indicating a trend of targeting older adults who may have savings.

Potential Impact of Minnesota’s Ban

The ban could inspire other states to take similar actions. Critics argue that kiosks have legitimate uses and that scammers will adapt. However, supporters believe this step may slow scams enough for some potential victims to reevaluate their situation before acting.

Prevention Tips

• Hang up if someone demands crypto payment.
• Verify emergencies before sending money.
• Reduce personal information exposure online.
• Be wary of instructions at the machine.
• Use strong antivirus protection to block scams.
• Consult your bank before making large withdrawals.
• Consider identity theft protection services.
• Report scams promptly to authorities and relevant organizations.

Kurt ‘CyberGuy’ Knutsson emphasizes the importance of pausing and verifying situations before acting on fear. He encourages reporting fraudulent activities quickly to help identify scam patterns and protect others.