North Dakota lawmakers propose new limits on crypto ATMs to combat scams

North Dakota lawmakers are reviewing a new bill imposing stricter regulations on cryptocurrency ATMs to protect residents from financial scams. House Bill 1447 would limit daily withdrawals, cap fees on top of transactions, and require fraud warnings on all crypto ATMs operating in the state.

The bill intends to limit crypto ATM customer withdrawals to $1,000 per day, cap fees to $5 per transaction or 3% of the total amount — whichever is higher — and require the machines to issue fraud warning notices.

Lawmakers push for stricter crypto ATM measures to combat rising fraud

During an address to the House Industry, Business, and Labor Committee on January 22, the North Dakota Department of Financial Institutions commissioner, Lisa Kruse, noted that the state’s residents filed 103 crypto scam complaints to the FBI for $6.5 million in losses in 2023.

The FBI reported in September that Americans lost $5.6 billion due to crypto fraud in 2023 and recorded 5,500 cases involving a crypto ATM, resulting in losses of over $189 million.

The primary sponsor of the bill, House Representative Steve Swiontek, noted that crypto ATMs currently lack the protection measures that traditional money ATMs have — making it easier for perpetrators to scam victims.

“Unfortunately, this has allowed criminals to exploit them for theft,” Swiontek said at the hearing.

Advocacy groups, such as AARP, have also supported the bill. AARP state director Josh Askvig pointed to its potential to help protect senior citizens, who are often targeted by scammers.

Crypto ATM operators warn restrictions on fees and transactions could harm the industry

While the bill has found support for its consumer protection focus, it has drawn criticism on fee and transaction limits.

CoinFlip crypto ATM operator assistant general counsel Kevin Lolli explained that the restrictions could harm the industry. He noted that typical fees for crypto ATMs range between 8% and 20%, including the cost of hardware, maintenance, armored car services, and the location’s rent.

“Restricting fees and transactions to these levels could keep operators from operating machines in North Dakota.” – Kevin Lolli

Lolli added that many crypto ATMs already comply with other anti-fraud measures, including reporting suspicious transactions over $2,000 and more than $10,000 to federal authorities.

The number of Bitcoin ATMs worldwide increased by over 7% between December 2024 and December 2023. As of January 23rd, 2024, 37,155 Bitcoin ATMs operate in 65 countries. Nearly 80% of these ATMs are US-based.