Tennessee Becomes Second State to Ban Crypto ATMs Statewide, Imposing Misdemeanor Penalties

Gate News message, April 24 — Tennessee has become the second U.S. state to impose a statewide ban on crypto ATMs, making it a misdemeanor to operate or host the machines anywhere in the state. Gov. Bill Lee signed House Bill 2505 into law on April 13 after it passed both chambers unanimously. The law officially took effect on Thursday and will become enforceable on July 1.

The legislation prohibits the installation and operation of “virtual currency kiosks,” commonly known as bitcoin ATMs, and applies to both operators and businesses that allow them on their property. Violations carry a Class A misdemeanor charge, resulting in penalties of up to one year in prison and a $2,500 fine. Indiana became the first state to enact a full statewide ban last month.

According to AARP, thirty states have introduced bills related to crypto kiosks in 2026, with twenty having already passed laws. Many of these states have added provisions requiring operators to hold state licenses, set daily transaction limits, and offer refunds to scam victims. Cryptocurrency kiosks were tied to nearly $390 million in reported losses in 2025 alone, with older Americans accounting for a disproportionate share of victims, according to FBI data.