Tennessee completely bans cryptocurrency ATMs, with violators facing up to one year in prison

According to The Block, Tennessee Governor Bill Lee signed House Bill 2505, officially classifying cryptocurrency ATMs (virtual currency self-service terminals) as prohibited devices, with the law set to take effect on July 1, 2026.

The bill passed both chambers unanimously, prohibiting the installation or operation of cryptocurrency ATMs statewide. Violators will face Class A misdemeanor charges, with a maximum penalty of one year in jail and a $2,500 fine. Notably, the scope of liability under this law covers not only ATM operators but also merchants that allow the devices on their premises. Tennessee thus becomes the second state in the U.S. to implement a comprehensive ban, following Indiana.

Previously, cryptocurrency ATMs had long been used by overseas scammers to carry out financial fraud, resulting in approximately $390 million in losses in 2025 alone, with the majority of victims being elderly individuals. Currently, 20 states across the U.S. have passed regulatory laws related to cryptocurrency ATMs, but most states have adopted measures such as licensing and transaction limits rather than a complete ban.