U.S. state Tennessee has banned the installation and operation of cryptocurrency ATMs across the state.

The Block reported on Thursday that anyone who operates cryptocurrency ATM machines in Tennessee or allows them to be installed at a business will be subject to punishment.

Tennessee Governor Bill Lee signed House Bill 2505 on April 13.

The new law bans the installation and operation of Bitcoin virtual currency kiosks. It applies not only to operators but also to businesses that allow the equipment to be installed. Violations are classified as a Class A misdemeanor, punishable by up to 1 year in prison and a $2,500 fine.

Tennessee became the second U.S. state to impose a statewide ban on cryptocurrency ATMs, after Indiana.

A report by AARP said 30 states have introduced bills related to cryptocurrency kiosks this year alone. As of 2026, 20 states have passed related laws. Many of them require operators to obtain state licences, set daily transaction caps or provide refunds to some fraud victims.

Cryptocurrency kiosks themselves are not illegal devices. They allow users to buy and sell cryptocurrency with cash and send funds to an external wallet address, but fraudsters have used them as a way to transfer scam proceeds, The Block reported.