Commerce committee backs ban on crypto ATMs, cites scams targeting seniors

The Commerce Full Committee on Feb. 26 voted 19–0 to advance House Bill 2505 to Calendar and Rules, a measure that would make it illegal to operate or allow use of kiosk-style cryptocurrency ATMs in Tennessee.

Representative Rudy introduced the bill, saying the kiosks facilitate “fast, hard-to-trace transfers” used by scammers. Sheriff Casey Cox of Cumberland County pointed to local cases and national data in testimony: “They use fear and urgency to convince these victims that they must immediately withdraw cash and deposit it into these crypto ATM machines,” Cox said, describing a Putnam County victim who lost about $300,000. Amy Hazlett of the Tennessee Bankers Association told the committee banks see large, rapid cash withdrawals tied to phone scams and said industry reporting suggests a very high rate of fraud at these ATMs. “There’s no legitimate purpose we see for these ATMs,” Hazlett said, adding that banks and suspicious-activity officers widely support the ban.

The bill’s sponsors and supporters framed the measure as a consumer-protection and public-safety action focused on older Tennesseans. The committee had no further questions and the clerk announced a unanimous recorded vote sending the bill to the next procedural stop. House Bill 2505 will now await calendaring and rules scheduling for floor consideration.