Tennessee Bitcoin ATM Regulations
Tennessee became the second U.S. state to ban Bitcoin ATMs. HB 2505 / Public Chapter 766 makes it a Class A misdemeanor for any operator or "other person" to install, permit, place, or operate a virtual currency kiosk in the state.
Overview
On April 23, 2026, Tennessee Governor Bill Lee signed HB 2505 into law as 2026 Tennessee Public Chapter 766, making it a Class A misdemeanor for "a virtual kiosk operator or other person to knowingly install or allow installation of, permit, place, or otherwise operate a virtual currency kiosk" anywhere in the state.
The bill passed the Tennessee House 94-0 and the Senate 32-0 on March 16, 2026 — a unanimous 126-0 vote across both chambers. Sponsors were House Speaker Cameron Sexton (R-Crossville) and Representative Jay Reedy (R-Erin). Tennessee is the second U.S. state to enact a complete ban on Bitcoin ATMs after Indiana (HEA 1116).
The law takes effect July 1, 2026. The statute draws no distinction between operators with strong compliance programs and those without — both are criminalized equally. The bill amends TCA Titles 4, 5, 6, 7, 8, 12, 13, 29, 39, 45, 47, and 67.
Enforcement
Operating a virtual currency kiosk in Tennessee on or after July 1, 2026 is a Class A misdemeanor:
- Up to 11 months and 29 days in jail
- Fines up to $2,500
- Each instance of installation, permission, placement, or operation can be charged separately
Enforcement falls primarily to local district attorneys, with civil-side oversight available through the Tennessee Attorney General. Because the offense is a per-se violation of the new statute, prosecutors do not need to prove consumer harm — only that the kiosk was knowingly installed, permitted, placed, or operated.
Property Owner Liability
The statutory language reaches far beyond ATM operators. By targeting "a virtual kiosk operator or other person" who "knowingly install[s] or allow[s] installation of, permit[s], place[s], or otherwise operate[s]" a virtual currency kiosk, the law pulls property owners, gas-station hosts, convenience-store operators, and landlords into the criminal liability ring.
Host Warning
If you host a Bitcoin ATM at a Tennessee business and the machine remains in service on or after July 1, 2026, you face a Class A misdemeanor charge alongside the operator. Existing hosting agreements should be terminated and machines removed before the effective date. Consult counsel before signing any new placement agreement that contemplates Tennessee.
Forfeiture Provisions
HB 2505 amends multiple TCA titles, including Title 39 (Criminal Offenses) and Title 29 (Remedies and Special Proceedings). The published bill abstract does not surface a dedicated forfeiture clause, but the multi-title amendments warrant a careful read of the engrossed text before deploying or removing hardware. We will update this section when the engrossed bill text is reviewed.
Legislative Background
HB 2505 moved through the legislature in roughly six weeks, passing both chambers unanimously on March 16, 2026 and receiving the governor's signature on April 23. The unanimous vote — across a Republican-led, business-friendly legislature — reflects how politically toxic Bitcoin ATMs have become after a wave of state AG enforcement.
Key facts cited during legislative hearings:
- FBI IC3 reported $333 million in Bitcoin ATM-related scam losses in 2025
- 86% of those losses came from victims aged 60 and over
- Tennessee follows enforcement actions in Massachusetts, Iowa, Connecticut, and Minnesota against major operators
- Indiana banned Bitcoin ATMs first via HEA 1116 (also effective July 1, 2026)
HB 2505 → Public Chapter 766
Read our coverage: Tennessee Criminalizes Bitcoin ATMs in Unanimous Vote — And Consumers Will Pay the Price