Nebraska has enacted stricter regulations on cryptocurrency ATMs in an effort to curb fraud and enhance consumer protections. Governor Jim Pillen signed the new legislation, known as the Controllable Electronic Record Fraud Prevention Act, into law on March 12.
New Licensing and Reporting Requirements
The law, introduced as part of Legislative Bill 609 by Senator Eliot Bostar on January 22, significantly tightens oversight on crypto ATM operations. Under the new rules, companies operating crypto ATMs must:
- Obtain a license under Nebraska’s Money Transmitters Act.
- Receive approval from the Nebraska Department of Banking and Finance before deploying new machines.
- Adhere to strict daily transaction limits and fee caps.
Daily Transaction Limits and Fee Regulations
The law sets specific transaction limits for users:
- New users can send up to $2,000 per day.
- Existing customers have a daily cap of $5,000.
- Fees are capped at 18% per transaction to prevent excessive charges.
Additionally, ATM operators must display scam warnings and employ a compliance officer to enforce anti-fraud measures.
Consumer Protections and Fraud Prevention Measures
To further protect users, the bill includes a refund policy for victims of fraud:
- New customers who report fraud within 90 days are eligible for a full refund, including fees.
- Existing users can receive a fee refund for fraudulent transactions.
Governor Jim Pillen described the move as part of Nebraska’s broader strategy to support the crypto industry while protecting residents from fraud:
“We want to place guardrails to prevent criminals from taking advantage of Nebraskans.” – Governor Jim Pillen
Closer Scrutiny on Crypto ATM Activity
Nebraska Department of Banking Director Kelly Lammers emphasized the state’s commitment to fostering a secure and transparent crypto environment. To enforce these regulations, Nebraska is setting up a dedicated oversight team to:
- Monitor crypto ATM activity.
- Track fraudulent transactions.
- Ensure compliance with new regulations.
Growing Trend of Crypto ATM Regulations
Nebraska joins a growing list of U.S. states cracking down on crypto ATM fraud. Recent regulatory actions include:
- Illinois: Senator Dick Durbin introduced The Crypto ATM Fraud Prevention Act to impose transaction limits and strengthen consumer protections.
- Arizona: Representative David Marshall introduced House Bill 2387, proposing similar restrictions and licensing requirements for crypto kiosks.
- North Dakota and Other States have also implemented stricter oversight measures to address rising cases of crypto ATM fraud.
With these new regulations, Nebraska aims to balance innovation with consumer protection, ensuring that crypto ATMs operate securely and transparently. As crypto adoption grows, other states may follow suit in implementing similar safeguards to protect users from fraudulent activities.
