North Dakota Legislature Advances Bill to Curtail Crypto ATM Transactions
With the growing fraud case in cryptocurrency use, State Legislators, in a new development, move a bill meant to place checks on crypto-ATM transactions.
On January 15, 2025, North Dakota presented House Bill 1447 to the state legislature, which targeted cryptocurrency ATM transactions. The bill follows on the heels of a frustrating uptick in crypto fraud; $6.5 million in losses reported by state residents in 2023. Conceived by Representative Steve Swiontek, the legislation aims to set in place key consumer protections to fight scams.
Daily ATM withdrawals would be capped at $1,000.
- Capping transaction fees at $5 or 3% of the transaction, whichever amount is greater.
- The bill reflects growing concern over crypto fraud and seeks to limit financial losses while ensuring ATM users are better informed.
Rising Crypto Fraud and Its Impact
Lisa Kruse, commissioner of the North Dakota Department of Financial Institutions, testified before the House Industry, Business, and Labor Committee and emphasized how fraud complaints have become more frequent. She cited the $6.5 million losses the state has accumulated in 2023 as proof the need for regulatory action is very timely.
It’s not confined to North Dakota. An FBI report in September 2024 said Americans lost $5.6 billion in cryptocurrency scams in 2023. Of these, 5,500 involved crypto ATMs and accounted for more than $189 million in losses.
Protecting Vulnerable Residents
In turn, most fraud prevention efforts are channeled into protecting elderly residents who happen to be the major victims of scams. Josh Askvig, the director of the North Dakota’s American Association of Retired Persons also supported the bill, citing its role of protecting senior citizens.
Under the draft law, the crypto-ATMs would:
- Display fraud warnings.
- Advise clients to call the police if they suspect fraud.
- Warn them that funds lost in scams could not be recuperated.
- These steps are meant to educate users and prevent any potential fraudulent activity.
Industry Concerns Over Fee Caps
While fraud prevention measures within the bill have been largely popular, the financial restrictions in the bill have their opposition from some quarters in the industry. Kevin Lolli, a representative of CoinFlip-a crypto ATM operator, testified that the fee cap would prevent operators from affording necessary costs such as machine maintenance, hardware, and rental fees. The transaction fees stand between 8% and 20%, well above the limits being proposed.
However, Lolli supported consumer protection measures and fraud awareness campaigns.
Conclusion
The bill is a step in the right direction in combating cryptocurrency fraud in North Dakota. The new restrictions and consumer protections are expected to reduce financial losses among residents, according to lawmakers in the state. If the bill passes the current debate, its influence could be felt across the board: It might set the pace for similar legislation throughout the country.
