Tennessee Becomes Second State to Outlaw Bitcoin, Crypto ATMs

Tennessee has become the second US state to ban Bitcoin ATMs, making it a crime in the Volunteer State to own or operate the machines identified by federal authorities as a vector for committing fraud against the elderly.

Whether or not operators’ kiosks offer the option to buy Bitcoin or other digital assets with cash, they have until July 1 to pull the plug under House Bill 2505, which Tennessee Governor Bill Lee signed passed into law on April 13, following the introduction of the legislation earlier this year.

The legislation was co-sponsored by Republican state Reps. Cameron Sexton and Jay Reedy. In a March statementSexton said the kiosks “have become a gateway for scammers to exploit Tennesseans, especially our seniors.”

Sexton noted that victims who have been scammed while using Bitcoin ATMs often have little hope of getting their money back once it is gone. That was around the time local authorities warned of a scam in which victims had lost $4 million to foreign scammers posing as law enforcement agencies.

Reedy, a certified master beef producer, said: “Crypto ATMs have given scammers a quick and easy way to target our citizens and scare them into withdrawing their savings.”

The two-page billwhich was introduced in February, classifies misdemeanors as a Class A misdemeanor, similar in Tennessee to simple drug possession and domestic violence.

In total, Tennessee is home to 651 Bitcoin ATMs, the majority of which are clustered around Nashville, the state’s most populous city and capital, according to Coin ATM radar. The locations range from gas stations and smoke shops to liquor stores.

According to the FBI figures Published this month, Americans over 60 lost $257 million last year to scams involving Bitcoin ATMs, up 58% year-over-year. By comparison, citizens under the age of 30 lost $6.6 million in 2025 due to these types of scams.

In March, Indiana became the first US state to impose a wholesale ban on Bitcoin ATMs WLFI. The publication quoted a law enforcement official as saying, “The number of reports has doubled every year for the past four years.”

Amid an increase in scams, several states have passed legislation imposing transaction limits and requiring refunds to victims. In Minnesota, lawmakers are thinking about it legislation that would follow Tennessee’s lead and ban Bitcoin ATMs across the state.