- 7-0 committee vote — Indiana Senate Financial Institutions Committee unanimously voted to ban Bitcoin ATMs outright
- HB 1116 amended from regulation to prohibition — originally proposed licensing and fee caps; rewritten as a complete ban after law enforcement testimony
- Sen. Scott Baldwin (R-Noblesville) — cited money laundering and tax evasion concerns as rationale for replacing regulation with prohibition
- CoinFlip claims 17,000 Indiana customers — says it paid $1.5 million in rent to kiosk hosts and generated hundreds of thousands in tax revenue
- First state-level ban attempt — goes beyond regulatory crackdowns in Iowa, Massachusetts, Missouri, and other states
- Pension investment provision removed — HB 1042's crypto ETF provision for public pensions was stripped in the same session
Indiana's Senate Financial Institutions Committee voted 7-0 Wednesday to ban Bitcoin ATMs entirely, replacing legislation that would have regulated the kiosks with an outright prohibition that could take effect within weeks.
The move marks the first state-level attempt to ban Bitcoin ATMs outright, escalating beyond the regulatory crackdowns in Iowa, Massachusetts, Missouri, and other states. Senator Scott Baldwin (R-Noblesville), who chairs the committee, cited money laundering and tax evasion concerns: "I think these kiosks have a strong propensity to be havens for money laundering, and havens for tax evasion."
From Regulation to Prohibition
House Bill 1116 originally proposed a regulatory framework requiring operators to obtain licenses, verify customer identities, and comply with transaction limits and fee caps. After last week's hearing — where law enforcement and fraud victims testified about scam losses while operators warned the rules would drive them out of business — Baldwin amended the bill to eliminate the industry instead.
"We're never in the business of putting anybody out of business," Baldwin said. "But I can think of no substantial legitimate reasons" to allow the kiosks to operate.
What the Ban Would Do:
- Operating a Bitcoin ATM in Indiana becomes an illegal deceptive act
- Indiana Attorney General can sue both the operator and the property owner hosting the kiosk
- Courts can order forfeiture of kiosks and all funds collected from users
- Violators must pay all state investigation costs
- Effective immediately upon passage — potentially within weeks
The amended bill advanced 6-1. The Indiana legislature plans to wrap up this month's session shortly, and any bill the governor signs would take effect immediately under the emergency language.
CoinFlip: "Shocked" by Ban
CoinFlip, an Illinois-based operator with 17,000 customers in Indiana, called the ban a response to "a lack of understanding of digital assets." The company said it has operated in Indiana for eight years, generating "hundreds of thousands of dollars in tax revenue" and paying more than $1.5 million in rent to kiosk hosts.
"We are shocked to learn that the state of Indiana would eliminate an entire industry based on a lack of understanding of digital assets and the services we already provide to 17,000 Hoosiers around the state."
— CoinFlip spokesperson
CoinFlip is currently facing a lawsuit from Iowa's Attorney General alleging that 94.92% of its transactions facilitated scams, with $11.2 million in consumer losses over three years. The company also faces a Civil Investigative Demand from Missouri's AG as part of a statewide industry investigation. CoinFlip denies the Iowa allegations.
The company emphasized it has "successfully worked with policymakers in 17 other states to pass smart, effective legislation that targets bad actors" — but Indiana appears unwilling to pursue that path.
AARP Praises "Accelerating" Fraud Focus
AARP Indiana, which advocates for residents over 50, thanked lawmakers for the ban. "The fraud occurring at these machines is not slowing down — in fact, it's accelerating," said Legislative Director Ambre Marr.
AARP's statement noted "the growing level of fraud committed through crypto kiosks" and thanked the General Assembly for "actively seeking solutions" to protect "older Americans from having their life savings stolen instantly by thieves."
Elderly consumers have been disproportionately harmed in documented cases nationwide. The Massachusetts AG found the median Bitcoin Depot scam victim was 67 years old, with over 70% aged 60+. The DC AG lawsuit against Athena Bitcoin found a median victim age of 71.
Pension Investment Provision Pulled
In the same session, the committee removed a provision from House Bill 1042 that would have allowed Indiana's public pension system to invest in cryptocurrency exchange-traded funds. Rep. Kyle Pierce (R-Anderson) cited poor crypto ETF performance: "That product is not doing extremely well."
The bill still allows members of certain plans to open self-directed brokerage accounts with crypto investment options — a "individual choice" scenario, Pierce noted, rather than state-managed investment decisions.
What Happens Next
If HB 1116 passes the full legislature and is signed by the governor, Indiana would become the first state to ban Bitcoin ATMs entirely. The emergency effective date means operators could face immediate enforcement.
Baldwin's rationale — that phone-based crypto exchanges make kiosks obsolete — mirrors arguments from consumer protection advocates who note that Bitcoin ATMs typically charge fees of 15-25%, while app-based exchanges charge 1-3%. But the ban goes further than any other state has attempted, raising questions about whether other legislatures will follow Indiana's lead or pursue the regulatory middle ground that CoinFlip and other operators have negotiated elsewhere.
For consumers concerned about Bitcoin ATM scams, visit our consumer protection resources for warning signs and reporting information.