TDCI’s Securities Division Supports Crypto Kiosk Ban, Renews Warning to Tennesseans to Learn Red Flags of Crypto Schemes
NASHVILLE – The Tennessee Department of Commerce & Insurance’s Division of Securities applauds Tennessee lawmakers for banning crypto kiosks in Tennessee and reminds consumers to remain on guard for future crypto-schemes that prey on unsuspecting investors.
With passage of HB 2505 earlier this year, Tennessee leaders outlawed the ATM-style electronic kiosks which are designed to facilitate buying cryptocurrencies. Cryptocurrency is a digital-only, unregulated currency that is not backed by a bank or a government and has no physical presence.
Crypto-kiosks look like traditional ATMs and are located in all the same kinds of places as ATMs can be found such as gas stations, convenience stores, and other high-traffic areas. However, crypto kiosks transfer real money into cryptocurrency via an electronic wallet. While these machines provide convenient access to digital currencies, crypto kiosks became increasingly used by scammers who used technology in order to take consumers’ savings. Consumers reported over $110 million in losses to scammers involving crypto kiosks were reported to the FTC in 2023, a tenfold increase since 2020.
“Tennessee’s ban on crypto kiosks does not prevent consumers from buying or trading cryptocurrencies, but it does take away the potential abuse of these kiosks by scammers,” said TDCI Commissioner Carter Lawrence. “I thank the members of the General Assembly for taking this important step that will increase the financial protection for Tennesseans of all ages today and into the future.”
For years, TDCI's Securities Division has been raising awareness about the proliferation of cryptocurrency scams – including those involving crypto kiosks– which cost Tennesseans their hard-earned money.
“The General Assembly’s ban of crypto kiosks takes away a platform that was highjacked by scammers and sends a strong message to fraudsters that they are not welcome in Tennessee,” said TDCI Assistant Commissioner for Securities Elizabeth Bowling. “I remind Tennesseans to remain vigilant and learn the red flags of crypto-scammers in order to avoid a potentially disastrous financial scam. They should always remember to contact our team if they have a question or if they are approached about an investment.”
To help consumers avoid the pitfalls of future cryptocurrency scams, TDCI’s Securities Division shares the following consumer tips:
- Never click on links or respond directly to unexpected calls, messages, or computer pop-ups. If you think it could be legitimate, contact the company or agency, but look up their number or website yourself. Don't use the phone number the caller or message gave you.
- Slow down. Scammers want to rush you, so stop and check it out. Before you do anything else, talk with someone you trust.
- Never withdraw cash in response to an unexpected call or message. Only scammers will tell you to do that.
- Be cautious if someone tells you something is a secret, or information cannot be shared with anyone. This is a method used by scammers that is a red flag because it isolates individuals from trusted resources.
- When buying or trading crypto be sure you are using a trusted exchange and only sharing your public wallet information - never your private wallet details.
Questions about an investment? Contact TDCI's Securities Division online at tn.gov/securities, by email at securities.1@tn.gov, or call 800-863-9117.