Hawaii is preparing to eliminate a popular way of buying cryptocurrency with cash after lawmakers concluded that digital-asset kiosks have become too closely associated with fraud.
Summary:
Hawaii will prohibit crypto ATMs and similar digital-asset kiosks starting October 1, 2026
The law links the ban to hundreds of millions of dollars in reported scam losses
Minnesota, Tennessee, and Indiana have also moved toward banning crypto kiosks
Governor Josh Green signed House Bill 1642 in July, making it illegal to own, operate, or manage a kiosk that accepts U.S. currency in exchange for digital assets. The new rules are scheduled to take effect on October 1, 2026.
The legislation points to federal fraud data as a major reason for the move. According to figures cited in the bill, U.S. authorities received more than 10,900 complaints involving crypto kiosks in 2024, with reported losses reaching approximately $246.7 million. The damage continued to mount in 2025, when losses during just the first six months approached $240 million.
Crypto ATMs have increasingly attracted attention from regulators because scammers can instruct victims to deposit cash and send cryptocurrency to wallets controlled by criminals. The transactions can be difficult to reverse once completed.
Hawaii previously considered a less restrictive approach. Proposals included transaction caps, blockchain tracing requirements, additional disclosures, and mechanisms that could require operators to reimburse victims of certain scams. Lawmakers ultimately opted for a complete prohibition instead.
The state is now joining a growing group of U.S. jurisdictions taking a tougher stance toward crypto kiosks. Minnesota, Tennessee, and Indiana have pursued bans, while other states have focused on imposing stricter operating requirements.
The Hawaii law reflects a broader shift in policy: instead of treating crypto ATMs simply as another financial service requiring oversight, some regulators are increasingly viewing their accessibility as a potential fraud risk in itself.
Related: Earlier, we reported that Interpol's global First Light 2026 operation uncovered cryptocurrency money-laundering schemes and more than $293 million in illicit assets, highlighting the growing role of digital assets in fraud.