North Dakota Senate Limits Crypto ATM Transactions to $2,000 Daily

The North Dakota Senate has passed House Bill 1447 with a decisive 45-to-1 vote, reintroducing a provision that limits daily crypto ATM transactions to $2,000 per user. The bill, originally introduced on January 15, aims to protect residents from scams by establishing new regulatory requirements for crypto ATMs and their operators. Initially, the bill proposed a $1,000 daily transaction cap, but the state’s House later adjusted the limit to $2,000 per day for the first five transactions in a 30-day period. The Senate has now reinstated a firm $2,000 cap without the five-transaction clause. The legislation must return to the House for approval before reaching Governor Kelly Armstrong, who will decide whether to sign it into law.

Under the bill’s provisions, crypto ATM and kiosk operators will be required to obtain a state money transmitter license, enforce the $2,000 daily transaction limit across their entire ATM network, and display fraud warnings at machines. Additionally, operators must employ blockchain analytics to detect suspicious transactions and report any fraudulent activity to authorities. They will also be obligated to submit quarterly reports with details about their kiosk locations, operator identities, and transaction data. Representative Steve Swiontek, the bill’s primary sponsor, believes there is a serious need for regulation, stating that the absence of adequate safeguards allowed criminals to exploit crypto ATMs for fraudulent schemes. The initiative passed after a similar law was enacted in Nebraska on March 13, known as the Controllable Electronic Record Fraud Prevention Act. At the federal level, Senator Dick Durbin of Illinois also introduced comparable legislation on February 25, due to a case in which a constituent was tricked into depositing $15,000 into a crypto ATM under the false pretense of avoiding arrest.

According to the Federal Trade Commission, fraud losses linked to Bitcoin ATMs surged almost tenfold between 2020 and 2023, and exceeded $65 million in the first half of 2024 alone. Consumers aged 60 and older were found to be three times more likely to fall victim to such scams. Despite the risks, the United States continues to lead the global crypto ATM market, hosting 29,822 machines, which account for 78% of the total worldwide. Canada follows with 3,486 machines, while Australia ranks third with 1,613 crypto ATMs.

This move by North Dakota underscores the growing concern over the potential for fraud and scams in the crypto ATM sector. By imposing a daily withdrawal limit and requiring operators to obtain licenses and implement fraud detection measures, the state aims to enhance consumer protection and reduce the risk of financial crimes. The legislation also reflects a broader trend of increased regulatory scrutiny on the crypto industry, as lawmakers seek to balance innovation with the need for safeguards against illicit activities. The bill's passage in the Senate marks a significant step towards tighter oversight of crypto ATMs, and its final approval by the House and the governor will determine its implementation.