Nebraska Enacts New Law Requiring Cryptocurrency ATM Operators to Obtain Licenses and Implement Anti-Fraud Measures

Nebraska Governor Jim Pillen's office announced on March 12 that the governor has signed Legislative Bill 609 (LB609) into law

As part of a broader move to enhance consumer protection in the rapidly evolving realm of cryptocurrency transactions, Nebraska has introduced a new law that will require operators of cryptocurrency ATMs to obtain licenses, submit regular reports, and implement anti-fraud measures.

Governor Jim Pillen announced the signing of Legislative Bill 609 (LB609) – also known as the Controllable Electronic Record Fraud Prevention Act – into law on March 12.

The bipartisan legislation, which was heavily supported by members of law enforcement for its role in aiding the fight against crypto-related fraud, is designed to safeguard users of cryptocurrency kiosks and ATMs, also known as Bitcoin machines.

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

“An important part of these efforts is to make sure that we have guardrails to prevent criminals from taking advantage of Nebraskans. We look forward to continuing to lay the groundwork for a safe and robust crypto industry in our state. This is good news for consumers.”

LB609 will require operators of cryptocurrency kiosks to obtain licenses under the Nebraska Money Transmitters Act and submit reports to the Department of Banking and Finance on a quarterly basis. The act will also require operators to provide easily comprehensible disclosures regarding the risks, fees, and exchange rates associated with cryptocurrency transactions.

Furthermore, operators will be mandated to implement anti-fraud measures, establish refund policies for fraudulent transactions, display consumer warnings in a prominent manner, and enforce transaction limits as determined by the department. The legislation also includes provisions for the forfeiture of controllable electronic records in criminal investigations.

Kelly Lammers, director of the Department of Banking, added: “Nebraska is open for business in the cryptocurrency space. That also means we need to increase transparency to assure those doing legal business in the State of Nebraska that you are absolutely welcome.”

The bill’s unanimous passage in both houses of the state legislature underscores the bipartisan consensus on the need for consumer protection measures in the cryptocurrency industry. As cryptocurrency transactions continue to rise in popularity, the potential for fraud and deception also increases, necessitating pro-active steps by state authorities.