Crypto ATM ban approved in Tennessee amid increasing scam prevalence

Mounting concerns regarding the exploitation of cryptocurrency ATMs have prompted Tennessee Gov. Bill Lee to approve legislation that would shut down such kiosks, making the state the second after Indiana to impose such a ban, reports The Record, a news site by cybersecurity firm Recorded Future.

Because crypto ATMs are available in many locations, such as convenience stores and gas stations, their use has raised doubts that scammers are exploiting them as payment channels to carry out fraudulent activities targeting vulnerable individuals. Cumberland County Sheriff Casey Cox has reported that overseas scammers often pose as government officials or tech support and use romance and investment schemes on messaging apps to build trust and defraud victims. He said the scammers employ social engineering techniques like fear and urgency to psychologically manipulate victims into falling for the online scam.

The FBI reported last year that crypto ATM scams resulted in major losses, especially among seniors. Iowa and Massachusetts also filed lawsuits against kiosk companies over alleged scam involvement and profits.