Nebraska Passes Law to Combat Crypto ATM Fraud

Nebraska Governor Jim Pillen has officially signed new legislation aimed at protecting residents from cryptocurrency-related fraud, particularly as crimes involving crypto ATMs surge across the U.S.

The Controllable Electronic Record Fraud Prevention Act, signed into law on March 12, seeks to curb fraudulent activities tied to crypto kiosks and ATMs, which have seen a tenfold increase in scams from 2020 to 2023, according to a Federal Trade Commission (FTC) report.

“Cryptocurrency is an important, emerging industry, and we’ve been working hard to build Nebraska into a cryptocurrency leader,” Gov. Pillen stated.

“An important part of these efforts is to make sure we have guardrails to prevent criminals from taking advantage of Nebraskans.”

New Rules for Crypto ATM Operators

The bill, LB 609, introduced by Senator Eliot Bostar, establishes strict regulations for crypto ATM and kiosk operators, including:

🔹 Mandatory licensing under Nebraska’s Money Transmitters Act
🔹 Approval by the Department of Banking and Finance
🔹 Quarterly reporting on kiosk locations and transaction data
🔹 Appointment of a compliance officer to enforce anti-fraud measures

Additionally, the law imposes transaction limits to reduce fraud risks:

📉 $2,000 daily limit for new users
📉 $5,000 daily limit for established users
📉 Fees capped at 18% of the transaction value

Enhanced Consumer Protection Measures

To further safeguard users, the legislation includes refund provisions:

✅ New customers can receive a full refund (including fees) if fraud is reported within 90 days
✅ Existing customers can get refunded for fraudulent transaction fees

Crypto kiosks must also display fraud warnings to alert users of potential scams.

Nebraska’s Crypto Stance vs. National Trends

While Nebraska is positioning itself as a crypto-friendly state, it has yet to join the 21 U.S. states working on strategic crypto reserves.

“Those who target our citizens using crypto ATMs as part of their transfer method—we will soon have a team watching even more closely,” said Kelly Lammers, Nebraska’s Department of Banking Director.

Meanwhile, other states are also tightening crypto ATM regulations. In January, North Dakota introduced House Bill 1447, proposing even stricter rules:

🔹 Daily withdrawal cap of $1,000
🔹 Fee limits of $5 or 3% per transaction (whichever is higher)
🔹 Mandatory fraud warning notices on all crypto ATMs

With Nebraska’s new law now in effect, the state is taking a firm stance against crypto-related fraud, while still encouraging responsible crypto industry growth.