Lawmakers in Delaware have moved forward with legislation that would eliminate cryptocurrency kiosks statewide, after officials linked the machines to a growing number of financial scams. The proposal comes as similar measures gain traction across the United States, with neighboring New Jersey also advancing a comparable ban.
The Delaware House Economic Committee voted to release House Bill 441 on June 9, sending it to the full chamber for consideration. The bill, sponsored by Representative Cyndie Romer and Senator Spiros Mantzavinos, would prohibit the installation, ownership, or operation of cryptocurrency kiosks, often referred to as Bitcoin ATMs.
Law targets machines tied to scams
Cryptocurrency kiosks allow users to convert cash into digital assets such as Bitcoin or Litecoin. These machines often appear in gas stations and grocery stores, where they resemble traditional ATMs. Authorities say that accessibility has made them a tool for fraud.
According to the Federal Bureau of Investigation, scammers frequently direct victims to deposit cash into these kiosks after establishing contact through social media, dating platforms, or online investment pitches. Once funds are converted into cryptocurrency and transferred, recovery becomes nearly impossible.
In 2025, the FBI’s Internet Crime Complaint Center received more than 13,400 complaints tied to cryptocurrency kiosks, with losses exceeding $388 million. That marked a 23% increase in complaints and a 58% increase in losses compared with the previous year. More than half of the cases involved individuals over the age of 50.
State-level data reflects similar patterns. Delaware recorded 181 complaints related to cryptocurrency and 255 complaints involving cryptocurrency wallets in 2025, with combined losses reaching $26.8 million.
Lawmakers cite consumer harm and high fees
Supporters of House Bill 441 argue that the machines serve little purpose for legitimate investors while exposing vulnerable users to financial harm.
“These kiosks reduce digital currency to a predatory cash grab,” said Rep.
Cyndie Romer, who chairs the House Technology & Telecommunications Committee.
“Regular crypto traders generally do not use crypto ATMs due to their much higher fees, which can be upwards of 20% of the value of the transaction, versus the 0.4% to 1% in fees for online exchanges. There is no reason to support a business structure that enables scammers to extort money from our most vulnerable populations.”
Delaware Attorney General Kathy Jennings described the kiosks as uniquely suited for fraudulent activity.
“To the average Delawarean, crypto kiosks may seem like mundane or quirky gas station novelties—but to scammers they are tailor-made to defraud consumers,” Jennings said.
“Scammers can and do convince innocent people to pay them significant amounts of money through these machines, and once your money goes in, it’s gone forever. These kiosks are obsolete for legitimate investors and ripe for abuse against everyone else. They have no place in our state.”
Removal mandate and enforcement provisions
If enacted, the bill would require all cryptocurrency kiosks in Delaware to shut down immediately and be physically removed within 90 days. The legislation also extends beyond standalone machines. It would prohibit any system that replicates kiosk functionality, including cashier-assisted transactions or point-of-sale setups that convert cash into cryptocurrency.
Violations would fall under Delaware’s consumer protection laws. Operators who collect fees through illegal transactions would need to refund victims within 30 days or forfeit those funds to the state’s Consumer Protection Fund.
The bill has received backing from multiple state and advocacy groups, including the Delaware Department of Justice, Delaware State Police, AARP Delaware, the Delaware Bankers Association, and the Delaware Bank Commissioner.
“Older Delawareans are disproportionately targeted in fraud and scams using cryptocurrency kiosks,” said Lucretia Young, AARP Delaware State Director.
“Many Delawareans who were convinced by scammers that they needed to move their money to protect their savings, help a loved one, or resolve a fake emergency have deposited money into these kiosks. When they lose the money to a scam, it’s often unrecoverable.”
Regional and national trend takes shape
The push in Delaware aligns with a broader shift across states. Indiana, Tennessee, and Minnesota have already enacted full bans on cryptocurrency kiosks. New Jersey lawmakers have also advanced legislation that would prohibit owning, installing, or managing such machines, citing a “significant rise in scams associated with their use.”
Some jurisdictions have taken alternative approaches. Arizona and California have introduced transaction caps instead of full bans, while several cities continue to debate local restrictions.
Industry operators have pushed back against the measures. Companies such as Bitcoin Depot have argued that they cannot be held responsible for criminal misuse and have pointed to on-screen warnings and transaction limits as safeguards. The company recently filed for bankruptcy, citing regulatory pressure among its challenges.
Debate centers on regulation versus elimination
Supporters of the Delaware bill emphasize that the measure does not reject cryptocurrency itself. Instead, they frame it as a targeted effort to remove a channel widely used for fraud.
“Supporting a ban of cryptocurrency ATMs is not a rejection of cryptocurrency itself. Rather it’s a recognition that the public interest requires safeguards against channels that are disproportionately exploited for criminal activity,” said David J. Mench, Director of Government Affairs for the Delaware Bankers Association.
Senator Mantzavinos echoed that position, stating that increased adoption of digital assets requires clearer oversight.
“An outright ban on cryptocurrency kiosks is a responsible measure for our State, as we have seen that crypto ATMs have been used to target and defraud consumers who may not fully grasp this technology, making them susceptible to scams.”
The bill now heads to the Delaware Senate, where lawmakers will decide whether the state will join others that have opted for a complete prohibition rather than regulation.
Matvii Diadkov
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