Michigan town with no Bitcoin Kiosks plans to impose strict rules on crypto ATMs

Grosse Pointe Farms, a small town in Michigan, USA, is the latest to join a growing list of US municipalities imposing strict regulations on cryptocurrency ATMs. Grosse Pointe Farms’s city council has recently passed an ordinance targeting the regulation of crypto kiosks, popularly known as Bitcoin ATMs, despite the town not currently having any such machines. Officials say the decision was fuelled by recent reports of a local being defrauded through a crypto ATM in nearby St. Clair Shores. The ordinance was passed unanimously during a city council meeting, making Grosse Pointe Farms one of the first municipalities in Michigan to formally regulate cryptocurrency kiosks. City attorney Bill Burgess outlined four key measures included in the ordinance. Notably, Operators of future crypto ATMs will be required to register with the Department of Public Safety and obtain a business license prior to deployment. The ordinance also mandates that operators display warning signs that alert users of the risks of fraud and the irreversible nature of crypto transactions. On top of that, new users will be subject to transaction caps during their initial two-week period. Specifically, first-time users will be limited to $1,000 per day and $5,000 in total transactions within the first 14 days. The limits are being put in place to provide a buffer period for users to familiarise themselves with the machines before conducting higher-value transfers. During the meeting, council member Lev Wood stated that the objective of this ordinance was to improve transparency and prevent residents from falling victim to any further scams. “The crooks tell people to go and put money into these machines, and it’s a very untransparent situation. What we want to do with our ordinance tonight is to enhance transparency and provide a little bit of help to our residents,” Wood said. Crypto ATMs, like standard ATMs, allow anyone to convert their fiat currency to cryptocurrencies like Bitcoin and Ethereum and vice versa. However, the anonymous and irreversible nature of cryptocurrency transactions and the fact that Bitcoin ATM transactions often lack identity verification have made these kiosks a tool for scammers to launder illicit loot . Michigan Attorney General Dana Nessel has previously issued statewide warnings about scams tied to crypto ATMs, urging residents to be careful when asked to send money through these machines. Local media, including the Detroit Free Press, have also reported multiple incidents involving unsuspecting residents. US states are cracking down on crypto ATMs Similar concerns have prompted several other US states and cities to enact their own restrictions or regulations on crypto ATMs in recent months. In Washington state, the city of Spokane recently became the first in the state to outright ban cryptocurrency kiosks. The Spokane City Council passed the measure unanimously, ordering all operators to remove their kiosks within 60 days. Before that, Nebraska signed the Controllable Electronic Record Fraud Prevention Act into law in March, which mandates operational licenses, transaction caps of $2,000 for new users, and refund policies for those defrauded. Similarly, North Dakota lawmakers passed House Bill 1447 earlier this year, formally imposing a $2,000 daily transaction cap, mandating blockchain analytics for fraud detection, and requiring operators to submit quarterly reports. Arizona also passed a similar bill earlier this year, setting a lower daily transaction limit of $1,000 along with mandatory licensing and consumer protection measures. The post Michigan town with no Bitcoin Kiosks plans to impose strict rules on crypto ATMs appeared first on Invezz

Source: Invezz