NASHVILLE, Tenn.— Tennessee has become the second state in the country to ban cryptocurrency ATMs, after Gov. Bill Lee signed legislation this month outlawing convertible virtual currency kiosks amid growing concern they are being used to facilitate fraud and scams, according to The Tennessean.
Under House Bill 2505, operating or owning a CVC kiosk in Tennessee will become a criminal offense beginning July 1, 2026, including for machines already installed, The Tennessean reported. The measure passed both chambers of the General Assembly without a dissenting vote.
CVC kiosks—also referred to as crypto ATMs or Bitcoin ATMs—allow consumers to exchange cash for cryptocurrency and have drawn increasing scrutiny as scammers direct victims to use them in impersonation, tax-payment and tech-support schemes, according to The Tennessean. The publication noted the machines are often placed in supermarkets and convenience stores, giving fraudsters a fast way to convert cash into digital assets that can be moved quickly and, in some cases, beyond U.S. law enforcement reach.
The move follows Indiana, which earlier this year became the first state to ban the kiosks, as policymakers respond to rising losses tied to the machines. Citing AARP, The Tennessean said cryptocurrency kiosks were used in scams that led to more than $333 million in reported losses in 2025, based on FBI data.