On April 23, 2026, Tennessee Governor Bill Lee signed HB 2505, effectively banning all cryptocurrency ATMs in the state. Tennessee becomes the second U.S. state to enact such a comprehensive ban, following Indiana's earlier move.
Unanimous Approval with No Opposition
The legislation, sponsored by House Speaker Cameron Sexton (R-Crossville) and Rep. Jay Reedy (R-Erin), passed the Tennessee House of Representatives by a vote of 94-0 on March 16, 2026. The Senate matched that margin the same day, voting 32-0. The law takes effect on July 1, 2026, and applies to all virtual currency kiosks currently operating in Tennessee, including those already installed.
Under the new law, a virtual currency kiosk is defined as any electronic terminal that facilitates the exchange of virtual currency for money, bank credit, or other virtual currency. This includes machines connected to external exchanges as well as those that hold digital assets directly. Operating, installing, or permitting such a kiosk on controlled property will be a Class A misdemeanor once enforcement begins. Owners, operators, and property managers are all subject to liability. No exceptions are granted for existing machines or licensed financial institutions.
Lawmakers cited fraud as the primary driver for the outright ban. The FBI's 2025 Internet Crime Report identified approximately $142 million in reported cryptocurrency scam losses in Tennessee alone. Kiosks have been a preferred tool for scammers because transactions are fast, difficult to trace, and nearly irreversible.
Senior Citizens Targeted; Bipartisan Support
“Virtual currency kiosks have become a gateway for scammers to exploit Tennesseans, especially our seniors, with little hope of recovering their money once it's gone,” Sexton remarked. Reedy echoed the sentiment: “Crypto ATMs are very often used in scams, especially ones that target seniors in our state. These ATMs allow fast, hard-to-trace transfers of money.”
The Tennessee Sheriffs’ Association and AARP were among the consumer advocacy groups that pushed for action, with pressure mounting after crypto ATM fraud surged starting in 2023. Earlier versions of the bill considered transaction limits and tighter regulations, but lawmakers ultimately chose a full ban.
According to coinatmradar.com, there are currently 20 active crypto ATMs serving the Murfreesboro area, with an additional machine in nearby McMinnville. These kiosks are embedded in everyday retail locations such as convenience stores, tobacco and vape shops, and neighborhood liquor stores. Every one of those locations faces a hard deadline: operators and property managers must decommission or remove all kiosks by July 1, 2026. No grace period is provided. Legitimate users who relied on in-person crypto transactions will now need to shift to online exchanges or digital wallets.
Indiana moved first with a statewide ban. Tennessee is now second. Other states watching fraud data closely may follow suit. The law is enrolled as Public Chapter 766, transmitted to the governor on April 13, 2026, and signed ten days later. Enforcement begins in just over two months.