US states are cracking down on crypto ATM scams

Two US states are tightening the rules around crypto ATMs, the standalone machines that let people swap cash for Bitcoin and other tokens. Hawaii is about to ban them outright, while Arizona has started refunding people who were tricked into using them. Both moves target the same problem: scammers who talk victims into feeding cash into a kiosk.

Hawaii will become the fourth US state to fully prohibit crypto kiosks. Governor Josh Green signed House Bill 1642 into law in July, and the ban on owning, operating or managing a machine that takes US dollars in exchange for digital assets takes effect on Oct. 1. Minnesota, Tennessee and Indiana passed similar total bans earlier. As of this week there were still 57 crypto ATMs running across four of Hawaii's islands.

The state pointed to the scale of the losses. Citing the FBI's Internet Crime Complaint Center, the bill noted that Americans reported more than $11 billion in digital-asset scam losses in 2025. Hawaii alone accounted for 826 crypto-related complaints and roughly $80 million in losses last year, including money lost through ATMs and kiosks.

Arizona took a different route: instead of banning the machines, it forces operators to pay victims back. Under a law that took effect in September 2025, a new customer who was fraudulently induced into a transaction can get a full refund, fees included, if they report it to both the operator and law enforcement within 30 days. The state attorney general says 35 people have recovered a total of $171,332 so far. New customers are also capped at $2,000 a day, against $10,500 for established ones.

The pattern behind these scams is almost always the same. Someone posing as a government official, a tech-support agent, a bank or an online romance creates panic or urgency and tells the victim the only fix is to send cash through a crypto ATM. Once the money is converted and sent, it is very hard to recover. No real government agency or legitimate company will ever ask you to pay a bill or a fine by feeding cash into a Bitcoin machine. If someone is rushing you to do exactly that, it is a scam, and slowing down to check is the safest move you can make.