Minnesota legislators have introduced House File 3642, a bill that would impose a complete ban on the placement and operation of all cryptocurrency kiosks and physical crypto ATMs across the state. The proposal, introduced by DFL Rep. Erin Koegel, would prohibit anyone from installing or running these machines and calls for repealing the existing regulatory framework established just two years ago in 2024.
The Minnesota Department of Commerce is strongly backing the move, with government relations director Sam Smith confirming the agency's support for HF 3642 and announcing plans to roll out broader consumer protections in the coming days. Currently, about 350 licensed Bitcoin ATMs from 8-10 companies operate across Minnesota. If passed, the bill would result in the shutdown of every single one.
The push for a ban follows the failure of Minnesota's 2024 regulatory attempt, which set $2,000 daily transaction limits for new customers and required fraud refunds. Law enforcement officials testified that scammers have simply adapted. Woodbury Detective Lynn Lawrence told the House Commerce Committee, "These machines remain one of the most effective tools that scammers are continuing to use to steal money." Some victims are now being instructed by scammers to drive to neighboring Wisconsin to bypass Minnesota's limits entirely.
Police Sgt. Jake Lanz described a particularly distressing case involving a 78-year-old woman on a fixed income who was coerced into sending roughly $80,000 over six months via crypto ATMs, leaving her facing housing instability. "These cases, for us to investigate, are incredibly difficult based off how the money moves from the ATM and then transactions that typically lead overseas," Lanz stated.
The problem is national in scope. The FBI recorded over 12,000 crypto kiosk fraud complaints and $333 million in losses through November 2025 alone, a significant increase from $250 million the year before. Adults over 60 accounted for 86% of those losses. Minnesota is not acting in isolation; Indiana lawmakers voted 7-0 to convert a regulation bill into an outright ban, Iowa's Attorney General sued operators Bitcoin Depot and CoinFlip after finding at least 95% of kiosk transactions were fraudulent, and Vermont extended its moratorium on new machines until July 2026.
The bill specifically targets physical kiosks, leaving online crypto transactions legal. CoinFlip, which operates 50 kiosks in the state, has pushed back, arguing for tighter regulations instead of a blanket ban. HF 3642 remains in committee with no vote scheduled, but the legislative direction signals that states are taking aggressive action independently of federal guidance from Washington.
