Thomas Daniels
In a decisive move to address crypto-related fraud, Wisconsin state legislators have introduced Senate Bill 386 to accompany the previously filed Assembly Bill 384. Both bills seek to regulate cryptocurrency ATMs through enhanced consumer protection and stricter licensing requirements.
Spearheaded by Senator Kelda Roys and six fellow Democrats, the Senate bill mirrors the lower house initiative led by Representative Ryan Spaude. The proposed legislation mandates that all crypto ATM and kiosk operators obtain a money-transmitting license and adhere to rigorous Know-Your-Customer (KYC) protocols.
Operators will be required to collect personal data, including full name, date of birth, address, email, and a government-issued ID. A customer photo must also be taken at the time of the transaction. Additionally, all transactions will be subject to a $1,000 daily limit per user.
The legislation mandates that all crypto ATMs display visible fraud warnings in the customer’s direct line of sight. Fees will be capped at $5 or 3% of the transaction value—whichever is higher. Furthermore, if an ATM transaction is confirmed to be fraudulent within 30 days, operators must provide full reimbursement to affected customers.
These measures come in response to growing concerns from federal authorities. The Financial Crimes Enforcement Network (FinCEN) has highlighted crypto ATMs as vehicles for fraud, cybercrime, and narcotics trafficking, with elderly individuals being disproportionately targeted by impersonation scams.
Wisconsin’s effort mirrors global regulatory trends. In July, New Zealand implemented a nationwide ban on crypto ATMs due to money laundering risks. Similarly, the United Kingdom has intensified enforcement, seizing several machines and arresting individuals connected to illicit operations. Even municipalities without current ATM installations, such as Grosse Pointe Farms in Michigan, have enacted preemptive regulations.
By filing companion bills in both legislative chambers, Wisconsin lawmakers aim to expedite the legislative process and improve the chances of enacting comprehensive crypto ATM oversight. If passed, the bills could serve as a model for other states grappling with the regulatory challenges posed by crypto kiosks.
