Cryptocurrency Kiosks in Minnesota Raise Fraud Concerns, Lawmakers Push for Ban
By Madison Hunter | FOX 9 Minneapolis-St. Paul | March 20, 2026
Minnesota is facing a growing wave of cryptocurrency-related scams linked to crypto kiosks installed in convenience stores and other local businesses across the state. In response, state lawmakers are pursuing legislation aimed at banning these machines to curb the rising incidents of financial fraud.
A New Frontier for Fraudsters
According to the Minnesota Department of Commerce, there are approximately 400 cryptocurrency kiosks operating statewide. While these machines provide quick access to buy and sell digital currencies, they have increasingly become a favored tool for scammers targeting vulnerable individuals.
One recent case involving Elk River resident David Richter highlights how sophisticated these scams can be. Last October, Richter received a popup warning on his computer claiming fraudulent activity on his bank account. The caller impersonated bank staff and federal agents, providing a convincing case ID and reference number. Under pressure to resolve the issue confidentially, Richter was instructed to withdraw $4,600 in cash and deposit it into a nearby crypto kiosk.
"He gave me the case ID, he gave a reference number," Richter recalled. "They wanted me to take money out of my account to deposit into the kiosk machine."
Who Is Targeted?
Richter has a strong background in financial services and fraud awareness, making him an unlikely victim. However, once his money entered the crypto kiosk system, it was transferred anonymously and irreversibly. Experts warn that most victims are people aged 60 and older or those unfamiliar with cryptocurrency.
"I still know very little about it, but I know to avoid it now," Richter said.
Regular cryptocurrency users typically avoid kiosks due to their high fees and unfavorable exchange rates. An investigation by the Iowa attorney general found that 95 to 98 percent of all crypto kiosk transactions are linked to scams, where the untraceable nature of digital currency appeals to criminals.
"Bitcoin ATMs continue to be one of the most common and damaging tools scammers are using here in Minnesota," said Detective Lynn Lawrence of the Woodbury Police Department.
Legislative and Law Enforcement Responses
In 2024, Minnesota implemented regulations requiring kiosk owners to limit transaction amounts and mandate refunds for verified scam victims. Despite this, police report that about half of such cases circumvent these limits, prompting calls for stronger action.
During just the first half of 2025, the FBI reported Americans lost approximately $240 million in crypto kiosk scams, with Minnesotans accounting for millions of dollars in losses.
Senator Amanda Hemmingsen-Jaeger (DFL-South Maplewood), who helped pass the 2024 regulations, is now advocating for a complete ban on crypto kiosks. "If we can get rid of these kiosks, these fraud machines, that’s a barrier now," she said. "We can’t completely stop fraudsters, but we can make the crimes harder by taking away some of the tools."
Bills proposing the ban have garnered bipartisan support, with the aim of removing crypto kiosks from Minnesota by the end of this year.
Industry Pushback and Victims’ Perspectives
Crypto kiosk operators argue that banning the machines penalizes legitimate businesses and users, emphasizing that scammers—not operators—are responsible for fraud.
Larry Lipka, a lobbyist for CoinFlip, stated, "It is not the kiosk operators that are facilitating these scams. It is the scammers."
Operators seek compromises similar to the 2024 law, such as offering full refunds for confirmed victims. However, authorities estimate that only about 25 percent of scam victims report crimes, often due to embarrassment or a lack of awareness.
After falling victim himself, Richter eventually received a full refund under the current law but hopes stricter legislation will protect others. "I really can’t think of a valuable purpose to have those machines available," he said. "Hopefully, my story helps lawmakers pass the ban."
Looking Ahead
As Minnesota grapples with this emerging fraud challenge, lawmakers are balancing consumer protection with technological innovation. The debate highlights broader concerns about cryptocurrency’s role in financial crime and underscores the difficulty of regulating digital assets.
For now, law enforcement urges the public to exercise caution around crypto kiosks and report suspicious activity to help prevent further losses.
For more information or to report suspected crypto kiosk fraud, Minnesota residents can contact the Minnesota Department of Commerce or local police departments.
This article originally appeared on FOX 9 Minneapolis-St. Paul.