Nevada Regulators Say Bitcoin ATMs Will Need License to Operate

The statement references a legislative session earlier in 2019, during which lawmakers failed to pass S.B. 195, an amendment to licensing rules which would affect ATM owners. Several laws pertaining to money transmission – NRS Chapter 671 and 679 are also mentioned.

Bitcoin and cryptocurrency ATMs need a licensing scheme, authorities in the state of Nevada have officially announced.

In a statement first reported on by local news media outlet Nevada Current on Aug. 28, the state’s finance regulator, the Financial Institutions Division of the Department of Business and Industry (NFID), said ATM operators must conform to existing rules.

Bitcoin ATM operators must contact authorities

“Any entity that facilitates the transmission of or holds fiat or digital currency by way of brick-and-mortar, kiosk, mobile, internet or any other means, should contact the NFID to request a licensure determination”, it reads.

“Over time, the NFID has monitored the growth and expansion of the blockchain, bitcoin, and virtual currency industries”, the statement summarizes.

It continues:

“Recently, several businesses and interested persons contacted the NFID to determine if a license was required to operate within the State of Nevada. Based upon the business model presented, a license may have been required for money transmission under NRS Chapter 671.”

Bitcoin ATM industry keeps expanding

According to monitoring resource CoinATMRadar, Nevada currently has 110 Bitcoin ATMs. The United States itself has more machines than any other country, accounting for almost 3,500 of the global total of 5,500.

The sector continues to see considerable growth, despite claims patronage is low due to the increased fees associated with using them versus online alternatives.

In June, the mayor of the Canadian city of Vancouver suggested ATMs should be banned altogether due to money laundering concerns.

Scammers Target Canadian Bitcoin ATM Users With ‘Out of Order’ Sign

Fraudsters in Winnipeg, Canada, have targeted Bitcoin ATM users in the city by simply sticking a poster on the machine. Police issued a warning on Aug. 29 that following the instructions on the poster will lead to an irretrievable loss of their Bitcoin.

Low-tech hack attack

Even with a digital currency like Bitcoin, security ultimately lies in the hands of the user, and a simple attack can often be the most effective.

Scammers in Winnipeg took exactly that tack. They attached a printed notice to the machine. The notice explained that the machine was undergoing a software upgrade. Due to this, users shouldn’t deposit their bought coins into their own wallet, but instead use a QR code provided.

The posters were found on two of the city’s twenty Bitcoin ATMs, but police said that nobody had admitted to falling victim to the scam.

Also in Canada

In Fredericton, the capital of the Canadian province of New Brunswick, a restaurant owner was conned by a fraudster pretending to be from the power company. She was told that her latest bill payment had not been received, and that she must deposit some money into a Bitcoin ATM or the power to her restaurant would be cut off.

After depositing $1,000 CAD, she was told that the payment hadn’t gone through and she needed to deposit another $800 CAD.

Police reported a spate of similar calls to local restaurants on Wednesday. A power company representative said that they would never ask a customer to deposit cash into a random Bitcoin ATM under threat of immediate disconnection.

Earlier this year Canadian police were asking for help identifying fraudsters who targeted Bitcoin ATMs with double-spend attacks.

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