CHARLOTTESVILLE, Va. (WVIR) – Legislation to regulate cryptocurrency kiosks has passed in both the Virginia state Senate and House.
If signed into law by the governor, the bill would create statewide rules for operators, including licensing and reporting requirements, and adds new consumer protections aimed at stopping scams. The legislation also prevents operators from marketing the kiosks as ATMs or using language that references them as ATMs.
The new protections include daily and monthly transaction limits, a 48-hour hold for new users so money can be returned after suspected fraud, ID verification for all transactions, and clear warning notices.
Delegate Michelle Maldonado, D-Manassas and sponsor of the legislation, said the bill was prompted by scam cases across Virginia, including a person in Southwest Virginia who was scammed out of $15,000 and another case in Fairfax County.
“The fact is, it’s kind of confusing to some people because they look like ATMs. They’re shaped like ATMs. But instead of taking money out, you’re sort of putting money in to purchase crypto that goes into a broader exchange,” said Maldonado, who represents Virginia’s 20th House District.
The problem, she said, is that people were being told there was something wrong and they had to buy cryptocurrency to pay off a debt, get out of legal trouble or as part of romance scams. In other places around the country, people have lost as much as $250,000 to similar scams.
“The thing about crypto is that once it goes into the exchange, which is in the blockchain environment, there’s no way to trace it. There’s no way to get it back,” Maldonado said.
The legislation requires kiosks to register, pay fees, cap their fees charged to consumers and provide refund mechanisms for available portions of money.
Maldonado said the approach represents a proactive regulatory strategy, noting that scams currently represent about 7% of the crypto kiosk industry’s business.
“That doesn’t mean that there’s no problem. It means that it’s in the beginning. And so this is the time to put the guardrails and the safeguards in place so that 7% doesn’t grow,” she said. “We really want to make sure that we are educating people, that we’re giving them the tools and that we’re holding industry accountable. And that means that the way they do business in the Commonwealth matters. And there’s got to be accountability.”
AARP Virginia says the changes are urgently needed as scammers increasingly use these unregulated kiosks to target Virginians, especially older adults.
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