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- North Dakota Senate passed House Bill 1447 to regulate crypto ATMs and protect residents from fraud.
- The bill requires crypto ATM operators to get licenses and track transactions using blockchain technology.
- Crypto ATM fraud has led to over $10 billion in losses, with elderly individuals being the most affected.
The North Dakota Senate approved a crucial bill to provide guidelines on crypto ATMs as 45 senators supported the bill, and one senator opposed it. The aim of House Bill 1447 is to safeguard residents from scams and fraud, as related to crypto ATMs. The bill is being sent back to the House for another vote to accept the amendment before finally being signed into law by a governor, Governor Kelly Armstrong.
New Crypto ATM Regulations
This legislation, which was introduced earlier this year, offers new regulations that affect operation of crypto ATMs in the state. It requires operators to acquire a license or approval for the performance of the contracting money transmitters role. Also, operators concerning fraud alerts and transactions must employ the use of the blockchain technology. The law also mandates that the reports of kiosk locations and sales figures be made at the quarterly basis.
The first provision is the daily cap of $2,000. For the first five trades within the first thirty-days period of trading. The original bill reduced the amount that a plaintiff could collect in a single day to $1,000. But the House committee raised this amount to $2,000 per day. The Senate maintained this provision in the bill to become one of its major provisions.
The use of crypto ATMs have been criticized in North Dakota as there has been a rise in the number of scams. Representative Steve Swiontek noted the fact that such machines have been used for stealing mentioning that some level of regulation is required. He stated that such legislations are important in order to protect the residents from being defrauded through Cryptocurrency ATMs.
Nebraska has already followed the same course and on 13th of March Controllable Electronic Record Fraud Prevention Act signed by governor Jim Pillen. In February, an Illinois Senator Dick Durbin introduced a bill to regulate scams associated with crypto ATMs.
Bitcoin ATM Fraud Losses
Crypto ATMs have become a massive problem as more people have been scammed. Users losses to fraud at Bitcoin ATMs were $10 billion in 2020 to 2023 according to the Federal Trade Commission. According to the data, in the first half of 2024 investment losses were more than $65 million, unfortunately, people over 60 were most affected. Specifically, individuals over the age of 60 are three times more likely to become targets of such scams.
At the moment, the United States witnesses the most Bitcoin ATMs usage throughout the world as the country has over 29,800 Bitcoin ATMs, which correspond to 78 percent of the global availability. Canada occupies the second place with 9.2% and Australia takes the fourth place with 4.3%.
