Delaware and New Jersey Move to Ban Crypto ATMs Over Fraud Concerns

Delaware and New Jersey each advanced bills this week to ban cryptocurrency ATMs statewide, citing mounting scam losses that have overwhelmingly hit older residents.

Delaware's House Bill 441 cleared the House Economic Development Committee on Monday after Rep. Cyndie Romer, Chair of the House Technology and Telecommunications Committee, told WBOC that the machines amount to "a predatory cash grab." The bill, co-sponsored in the Senate by Sen. Spiros Mantzavinos, would require every existing kiosk to go dark immediately upon enactment and be physically removed within 90 days. In New Jersey, Senate Bill S-2141 cleared the Senate Commerce Committee unanimously Monday and now heads to the full chamber, the Jersey Vindicator reported.

Delaware lawmakers cited more than $26 million in state ATM-related scam losses last year. New Jersey's bill sponsor, Sen. Paul Moriarty, cited FBI data showing 369 New Jersey victims lost roughly $18 million during the same period. Nationwide, the FBI's Internet Crime Complaint Center recorded 13,400 complaints tied to crypto ATM scams in 2025, with losses topping $388 million, a 58% increase over the prior year.

The typical fraud follows a documented pattern: a scammer impersonates a government official, bank representative, or law enforcement officer, creates a sense of urgency, and directs the victim to deposit cash at a nearby kiosk. Crypto transactions are irreversible, recovery is rare, and more than half of all national crypto ATM fraud complaints involve victims over 60, according to FBI data cited at the hearing.

Delaware's bill would also prohibit workaround arrangements, including cashier-assisted crypto purchases that replicate kiosk functions. Violators face unlawful trade practice charges under Delaware's consumer protection laws, and operators collecting fees from fraudulent transactions must either refund victims within 30 days or forfeit the funds to Delaware's Consumer Protection Fund.

The industry pushed back during the New Jersey hearing. Larry Lipka, general counsel for CoinFlip, described as the world's largest crypto kiosk operator, told the committee that CoinFlip has more than 23,000 New Jersey customers and an overall scam rate below 1%. He proposed regulation with mandatory transaction monitoring and blockchain analytics as an alternative to prohibition. The committee advanced the bill regardless, with all five members voting in favor.

Tennessee, Indiana, and Minnesota already have statewide crypto ATM bans. Since 2023, at least 30 states have enacted legislation touching cryptocurrency kiosk regulation.

Delaware's HB 441 now heads to the full Senate. New Jersey's S-2141 awaits a full-chamber vote; a companion Assembly bill has been referred to the Science, Innovation and Technology Committee.