Pritzker Proposes Crackdown on Crypto ATMs to Address Scams, Money-Laundering
Gov. JB Pritzker is expected to propose a crackdown on cryptocurrency ATMs during Wednesday’s State of the State address — a move his administration says will help address the scamming and money-laundering that have become pervasive in the industry.
Proposed Legislation
The legislation would establish a daily limit for transactions on crypto ATMs, cap fees to “prevent predatory charges” and require receipts showing the dollar value of digital assets and any fees collected, according to a fact sheet provided by Pritzker’s administration.
Why the Need for Regulation
“When left unregulated, crypto kiosks are often used as tools for scams that victimize the most vulnerable Illinoisans,” Pritzker said in a statement. “Those who are harmed by these scams have little or no ability to seek restitution or justice because of the unrestricted nature of these ATMs. In addition, the ATMs are a common tool in laundering money for drug transactions and other illegal activities.”
Chicago a Hub for Crypto ATMs
The Sun-Times reported this year that Chicago has become a hub for crypto ATMs. The U.S. Drug Enforcement Administration noted in a recent report that Illinois has roughly 1,626 crypto ATMs, including 1,167 in Chicago, warning that such devices draw people from outside the state and are often used for illicit purposes.
A Smoke Shop in Irving Park Displays Signage for a Bitcoin ATM
A smoke shop in Irving Park displays signage for a bitcoin ATM inside.
Anthony Vazquez/Sun-Times file
Previous Legislation
Illinois lawmakers proposed legislation last year that would have forced crypto ATM operators to register kiosks with the state and cap usage fees that are often exorbitant. But the legislation died in the state Senate without getting voted on.
Pritzker’s Proposal
Pritzker said his proposal “would institute the same common-sense registration and regulation requirements that already exist for financial institutions across the state.” “If passed into law, we can stop the flow of crime through these kiosks and better protect Illinois communities, while still allowing legitimate crypto users to conduct transactions as they have been doing,” he added.
Broad Legislation
Pritzker on Wednesday also plans to announce broader legislation that would “establish regulatory oversight of cryptocurrency companies to protect consumers and investors, similar to the regulations that already apply to more than 3,200 Illinois banks, credit unions and other traditional financial services firms.” That bill includes a range of safeguards, including disclosures on fees and charges and supervision of “risks posed by cyber threats, fraud and money-laundering.”
Trump Administration’s Approach
Meanwhile, President Donald Trump’s administration is taking a softer approach to policing a burgeoning industry that Trump and his family are personally invested in. An executive order Trump signed days after re-taking the Oval Office last month aims “to support the responsible growth and use of digital assets, blockchain technology and related technologies across all sectors of the economy.” The edict, which came amid a flurry of executive orders signed by Trump, notably rolls back directives instituted under his predecessor, Joe Biden. Trump’s order, signed January 23, empowers a working group of administration officials to “recommend regulatory and legislative proposals” that advance Trump’s crypto-related policy goals.
Conclusion
Pritzker’s proposal aims to address the growing concerns surrounding crypto ATMs, which have become a hub for scams and money-laundering. By establishing daily limits, capping fees, and requiring receipts, the legislation hopes to protect Illinois communities and prevent the misuse of these devices.
FAQs
* What is the purpose of Pritzker’s proposal?
Pritzker’s proposal aims to address the scamming and money-laundering that have become pervasive in the cryptocurrency industry.
* What are the key components of the proposed legislation?
The proposed legislation would establish a daily limit for transactions on crypto ATMs, cap fees to “prevent predatory charges” and require receipts showing the dollar value of digital assets and any fees collected.
* What is the Trump administration’s approach to regulating the cryptocurrency industry?
The Trump administration is taking a softer approach, aiming to “support the responsible growth and use of digital assets, blockchain technology and related technologies across all sectors of the economy.”
