Lawmakers in North Dakota have taken significant action to regulate crypto ATMs by approving a bill that establishes a $2,000 limit on daily transactions for each user.
On March 18, the state Senate endorsed House Bill 1447, which aims to reduce fraud and improve oversight.
HB 1447 intends to safeguard residents from the increasing incidents of fraud associated with crypto ATMs. As reported, North Dakota currently has about 45 Bitcoin ATMs, part of a larger network of roughly 29,730 machines throughout the United States.
With Senate approval achieved, the bill is expected to return to the House for additional deliberation before it can be signed by the governor. If signed into law, North Dakota will create a more robust regulatory structure to tackle crypto ATM fraud while ensuring that users retain access.
Details of the Bill
HB 1447 sets forth stricter regulations for operators of crypto ATMs, requiring them to obtain a money transmitter license to operate their machines in the state.
The legislation mandates clear and legible disclosures of terms and conditions in the language preferred by the customer.
It also requires the use of blockchain analytic tools to identify fraudulent transactions, monitor suspicious wallet activities, and flag potential money laundering activities. Regulators will be able to demand evidence that operators are effectively utilizing these tools.
Additionally, crypto ATMs must show fraud warnings before processing transactions, assisting users in recognizing possible scams.
Operators are also obliged to develop and maintain a written anti-fraud policy to ensure proactive measures are taken to detect and avert fraudulent actions.
The bill states:
“A virtual-currency kiosk operator shall take reasonable steps to detect and prevent fraud, including establishing and maintaining a written anti-fraud policy.”
Alongside these security provisions, the bill enforces a $2,000 limit on daily withdrawals. Initially, a $1,000 cap was suggested, but this was later increased to offer more flexibility while still prioritizing fraud protection.
The legislation also requires ATM operators to offer live support on weekdays from 8 A.M. to 10 P.M. Central Time to enhance customer assistance. A toll-free customer service number must be prominently displayed on the machine or its interface.
