There are new rules for “crypto ATMs” in Iowa that let people buy or sell digital currency.
The governor has signed a bill into law that limits transaction amounts, so customers may transfer or accept no more than $1000 worth of crypto in a single day. Crypto ATM fees may be no more than 15% of the transaction amount. And crypto ATM operators must provide a full refund if a customer reports they were scammed and can show there was fraud involved in the transaction.
During House debate earlier this month, Republican Representative Shannon Lundgren of Peosta cited an investigation by Iowa’s attorney general that found “hundreds” of Iowans who used crypto ATMs lost $20 million in the past three years. “I’m not saying that cryptocurrency is a bad thing. I’m not saying that our folks here in Iowa are causing these scams,” Lundgren said, “but what they certainly haven’t done…is regulate themselves.”
The law gives Iowa’s attorney general authority to levy hefty fines against crypto ATM operators who violate the law. The Iowa Sheriffs’ and Deputies’ Association, the Iowa Bankers Association and AARP are among the groups that lobbied for the bill.
During Senate debate in March, Senator Charlie McClintoch, a Republican from Alburnett, cited federal data from 2024 that found that more than two-thirds of crypto scams involved the use of crypto ATMs. “The targeted group that they have is usually over age 60,” he said, “and you can see the importance of why we’re trying to avoid this.”
The bill passed with the support of 122 members of the Iowa House and Senate, but 14 lawmakers did oppose the bill. Representative Ray “Bubba” Sorensen of Greenfield said the law won’t deter scammers. “Over regulation of crypto kiosks won’t stop the phishing scams. It will only further restrict access for law abiding citizens. Restricting crypto currency transactions hinders financial freedom and prevents individuals from participating in a growing investment sector,” Sorenson said earlier this month on the House floor. “…Just as we wouldn’t ban stock trading because of market fraud, we shouldn’t restrict cryptocurrency access to due to scams that can be better addressed through law enforcement.”
Representative Keenan Judge, a Democrat from Waukee, responded, saying the law doesn’t outlaw crypto ATMs. “It just puts some serious legislation into place,” Judge said, “and I think a big part of our job as legislators is to protect people from these type of scams.”
The first crypto ATM was installed in a coffee shop in Canada in 2013. Today, there are more than 30,000 crypto ATMs in the United States, located in convenience stores, bars, restaurants and grocery stores. Iowa’s new law requires detailed receipts for crypto ATM transactions and customers have to get several warnings in writing, including the following: “NEVER SEND MONEY TO SOMEONE YOU DO NOT KNOW.”
