Delaware and New Jersey Advance Bills to Ban Crypto ATMs

Delaware and New Jersey both advanced bills this week to ban crypto ATMs. Delaware’s House Economic Committee passed House Bill 441 to the full chamber on Tuesday. New Jersey’s Senate Commerce Committee cleared S-2141 unanimously the day before. Both bills target the cash-to-crypto kiosks that have become fixtures in gas stations, bodegas, and convenience stores, and both cite the same set of FBI numbers to make the case.

The industry that grew up around those kiosks is now absorbing the consequences. Bitcoin Depot, formerly the world’s largest crypto ATM operator, filed for bankruptcy last month and took its roughly 9,700-kiosk network offline. State attorneys general have sued the major operators. The pending bans in Delaware and New Jersey are the legislative bookend on a year that has already produced total prohibitions in three other states.

## Delaware’s Bill Sets a 90-Day Clock for Kiosks

House Bill 441, sponsored by Rep. Cyndie Romer and Sen. Spiros Mantzavinos, would establish a total ban on the installation, ownership, or operation of cryptocurrency kiosks inside Delaware. The bill cleared the House Economic Committee on Tuesday and now heads to the Senate. If it becomes law, every existing machine in the state would have to be taken offline immediately, then physically removed within 90 days.

The bill reaches beyond the machines themselves. It also makes it illegal to directly or indirectly facilitate the purchase or transfer of cryptocurrency in exchange for fiat currency through a retail point-of-sale system, cashier-assisted transaction, or other mechanism designed to replicate or substitute for a cryptocurrency kiosk. Operators who violate the ban would be required to fully refund any fees they collected within 30 days or forfeit the money to Delaware’s Consumer Protection Fund.

Regular crypto traders generally do not use crypto ATMs due to their much higher fees, which can be upwards of 20% of the value of the transaction, versus the 0.4% to 1% in fees for online exchanges. There is no reason to support a business structure that enables scammers to extort money from our most vulnerable populations.

Romer, who chairs the House Technology and Telecommunications Committee, called the kiosks a predatory cash grab in the bill’s release. Delaware Attorney General Kathy Jennings, AARP Delaware, the Delaware Bankers Association, the Delaware Department of Justice, Delaware State Police, and the Delaware Bank Commissioner are all on record supporting the measure, according to the the Delaware House Democrats press release on HB 441. “Supporting a ban of cryptocurrency ATMs is not a rejection of cryptocurrency itself,” said David J. Mench, the Bankers Association’s director of government affairs. “Rather it’s a recognition that the public interest requires safeguards against channels that are disproportionately exploited for criminal activity.”

## New Jersey’s Bill Brings Industry Lobbyists to the Mic

S-2141 cleared the Senate Commerce Committee on Monday after roughly an hour of testimony. All five members voted to send the bill to the full chamber. A companion bill in the General Assembly has been referred to that chamber’s Science, Innovation and Technology Committee. The bill’s main sponsor, Sen. Paul Moriarty, a Gloucester County Democrat who first proposed the measure in 2024, framed the kiosks as gateways for fraud and other scams.

They are high-tech machines that facilitate fraud, scams, and other illegal activities. And the owners of these networks take a big cut of the illicit proceedings. They may not be the scammers, but they are the middlemen taking a big cut and making it happen.

The committee heard from Larry Lipka, general counsel for CoinFlip, who argued against a ban. CoinFlip is the world’s largest crypto kiosk operator, and Lipka said the company has more than 23,000 customers in the Garden State with an overall scam rate under 1%. He told lawmakers the company would be willing to refund scam victims in full if the legislature instead chose to enact a regulatory bill requiring crypto operators to take the same anti-fraud measures CoinFlip already uses, such as transaction monitoring, consumer protection holds, and blockchain analytics. the Jersey Vindicator’s account of the Senate Commerce Committee hearing reports that none of Lipka’s arguments changed the outcome.

Moriarty said kiosk owners may not be the scammers, but they are the middlemen taking a big cut and making it happen. “Often, people don’t report this because they’re so embarrassed that they’ve been taken. It leads to some really dire consequences in their life, both financially and mentally,” he added. The full Senate vote is the next procedural step.

## Three States Have Already Crossed the Line

Delaware and New Jersey are not leading. They are catching up. Indiana became the first US state to ban crypto ATMs outright in March 2026. Tennessee Gov. Bill Lee signed a total ban in April, with the prohibition set to take effect July 1. Minnesota passed its own ban in May. New Hampshire has a similar bill on the governor’s desk, according to the Record’s report on Tennessee’s ban taking effect July 1.

The Delaware press release on HB 441 says 30 states have enacted legislation related to the regulation of crypto kiosks since 2023. Other states, including Arizona and California, have taken a different approach by capping the value of transactions allowed at the machines rather than banning them outright.

## The $388 Million Behind the Crackdown

The FBI’s 2025 Internet Crime Complaint Center data is the lever both committees pull. The five national numbers anchoring the case are in the snapshot below. At the state level, the same pattern shows up. In Delaware, the FBI logged 181 complaints involving cryptocurrency and 255 complaints involving cryptocurrency wallets in 2025, for $26,893,098 in losses.

New Jersey reported 369 victims and about $18 million in losses. Moriarty told his committee that seniors are three times more likely than young adults to report losing money in a crypto ATM scam. The age skew is what makes the kiosks a uniquely senior-targeting fraud channel.

• More than 13,400 crypto ATM complaints to the FBI’s IC3 in 2025
• Over $388 million in losses tied to those complaints
• 23% rise in complaints from 2024
• 58% rise in losses from 2024
• Over half of national complaints involved people older than 50

“Older Delawareans are disproportionately targeted in fraud and scams using cryptocurrency kiosks,” said Lucretia Young, AARP Delaware’s state director, in the Delaware release. CoinFlip’s general counsel put a counter-number to the same New Jersey committee: more than 23,000 customers in the Garden State with an overall scam rate under 1%, by CoinFlip’s own count. The gap between the FBI’s national tally and the industry’s per-user claim is the contested ground the bills are being written onto.

## Bitcoin Depot’s Bankruptcy Marks the Industry’s Tipping Point

Bitcoin Depot, once the largest crypto ATM operator in the world, filed for Chapter 11 bankruptcy protection in May. CEO Alex Holmes said in a statement on the company’s website that the firm has taken its network of some 9,700 kiosks offline and will cease operations. Holmes blamed “increasingly stringent compliance obligations, including new transaction limits, and in some jurisdictions, outright restrictions or bans” on crypto ATMs, according to the ICIJ report on Bitcoin Depot’s bankruptcy filing.

The company’s quarterly revenue plummeted by nearly 50% year on year in the three months ended March 2026, according to SEC filings the ICIJ reviewed. The filings attributed the drop to “state and municipal regulations banning or restricting Bitcoin ATMs, capping fees and limiting transaction sizes,” along with the company’s own investments in anti-fraud and know-your-customer tools. Connecticut separately suspended Bitcoin Depot’s banking license for lapses in anti-money-laundering controls.

State enforcers have multiplied. Massachusetts’ attorney general sued Bitcoin Depot in February, alleging that more than 80% of the customers her office contacted were victims of scams. Iowa sued Bitcoin Depot and CoinFlip. Washington, D.C. sued kiosk operator Athena in September, alleging that 93% of the company’s transactions in the district were scam related. A nearly $19 million arbitration award landed against Bitcoin Depot in late 2025 over the business dealings of a Canadian subsidiary, the ICIJ report said.

## What the Bans Actually Require of Operators

Both bills move past the rhetoric into specific enforcement teeth. The Delaware framework is built on top of the state’s existing consumer protection law. The New Jersey bill creates its own escalating penalty structure.

• Delaware: criminalize installation, ownership, and operation of any crypto kiosk.
• Delaware: 90-day physical removal window after the law takes effect.
• Delaware: cover point-of-sale and cashier substitutes designed to replicate a kiosk.
• New Jersey: ban on owning, controlling, installing, managing, selling, or offering to sell a crypto ATM.
• New Jersey: penalty up to $10,000 for a first offense, $20,000 for subsequent offenses.

CoinFlip’s offer to refund scam victims in full, if the legislature chose a regulatory path instead, is now in the record. Whether the full Senate and Assembly choose to take that offer is the next vote to watch.

## Frequently Asked Questions

What is a crypto ATM?

A crypto ATM is a cash-to-crypto kiosk, usually found in a gas station, bodega, or convenience store, that lets a customer feed in cash and receive cryptocurrency in return. The machines are operated by third-party companies that take a fee on each transaction.

Why are states banning crypto ATMs?

Lawmakers in Delaware and New Jersey point to FBI Internet Crime Complaint Center data showing more than 13,400 crypto ATM complaints in 2025 and over $388 million in losses. Over half of the national complaints involved people older than 50, and Delaware’s attorney general has called the kiosks tailor-made to defraud consumers.

Which states have already banned crypto ATMs?

Indiana, Tennessee, and Minnesota have all passed total bans in 2026. Tennessee’s law takes effect July 1, 2026. Delaware’s HB 441 and New Jersey’s S-2141 have cleared committee in their chambers but have not yet become law.

What happens to an operator that keeps running a kiosk after a ban takes effect?

Under HB 441 in Delaware, violations would be treated as an unlawful practice under the state’s consumer protection laws, and any operator collecting fees from illegal transactions would have to refund the victim within 30 days or forfeit the money to the Consumer Protection Fund. The New Jersey bill sets a penalty of up to $10,000 for a first offense, doubling to $20,000 for subsequent offenses.

Does a crypto ATM ban ban cryptocurrency itself?

No. The legislation targets the kiosk channel, not the underlying assets. David J. Mench, the Delaware Bankers Association’s director of government affairs, made that distinction explicit in the HB 441 release.