Bill
S 9891
New York would regulate crypto kiosks and cashier exchanges with strict consumer protections, hold periods, fee caps, AML/KYC, and strong enforcement.
Purpose and scope
- This bill adds a new article (Article 2-AAA) to the New York Banking Law creating a comprehensive regulatory framework for crypto kiosks and cashier crypto exchanges operating in the state.
- The core aim is to regulate consumer protection, disclosure, hold periods, fraud refunds, fees, anti-money laundering, and transaction limits to reduce risk and enhance oversight of crypto-asset transactions conducted through kiosks or cashier exchanges.
Key definitions (Sec. 76-a)
- Consumer: any natural person using a crypto kiosk, regardless of account creation.
- Crypto kiosk: any electronic terminal/location enabling exchange of money for virtual currency, including connections to a separate virtual currency exchange.
- Operator: an entity that conducts virtual currency business via a crypto kiosk or cashier crypto exchange in NY, including consolidated groups acting in concert.
- Cashier crypto exchange: a method of exchanging virtual currency for funds collected at a retailer acting as an agent.
- Virtual currency, funds, execution: defined with standard industry meanings; execution is the irreversible transfer to the consumer’s blockchain address.
Registration and oversight (Sec. 76-b)
- Operators must register with the NY Department (presumably Department of Financial Services or designated department) with details on the number and locations of kiosks.
- Registration number must be publicly posted on each kiosk or cashier exchange with a toll-free contact.
- Failure to register triggers a cease-and-desist order, civil penalties (up to $10,000 per kiosk/exchange), and penalties of at least $50 per transaction or twice the operator’s profit from the non-compliant activity, plus unenforceability of related contract Waivers.
Disclosures and pre-transaction transparency (Secs. 76-c, 76-d, 76-e)
- Pre-transaction disclosures: operators must clearly disclose terms, fees, exchange rates, and other relevant conditions in the user’s language.
- Acknowledgement of disclosures must be captured at each interaction.
- Pre-completion warning: a mandatory, non-alterable warning about potential scams involving impersonators (e.g., government, law enforcement, friends/family) and instructions to contact authorities and the operator.
- Display of owner/operator contact info, and law enforcement/government reporting channels at the kiosk or first screen.
Transaction receipts (Sec. 76-e)
- Operators must provide paper and electronic receipts with: operator contact, fraud-report channels, transaction details (type, value, date/time, addresses, transaction hash where available), all fees, exchange rate, refund policy, and any department requirements.
Customer service (Sec. 76-f)
- Live customer support during business hours (8 AM–10 PM local time) with toll-free numbers clearly displayed and staffed by trained personnel.
Hold periods and consumer refunds (Sec. 76-g)
- Hold on high-value receipts: for $1,000+ in a 24-hour period, a 72-hour hold on transmissions.
- Funds must be held in consumer-owned segregated accounts; ownership remains with consumer until execution.
- Hold period calculations aggregate all transactions across kiosks within 24 hours.
- Consumers may cancel and be refunded in full, including fees, within the hold period (refunds within 7 business days by certified mail).
- Penalties for violations, and private rights of action for consumers if refunds aren’t provided.
Fraud refunds (Sec. 76-h)
- In fraud cases, operators must refund the full amount (including fees) at the time of transaction, with refunds in the originating currency and no fees charged for refunds.
- Eligibility requires fraud notification within 90 days and a police/government/sworn statement within 120 days.
- Refunds issued within 72 hours after documentation.
- Multilingual notices and assistance.
Prohibition on currency transmission (Sec. 76-i)
- Cashier crypto exchanges may only facilitate exchanging crypto for USD (cash or bank deposits) and may not enable crypto-to-crypto transmissions.
Fees and penalties (Sec. 76-j)
- Caps total fees on a single transaction or related series at 3% of the USD value.
- Civil penalties for violations, with additional private right of action for consumers to recover overcharges (minimum $1,000 or triple damages).
Fraud, AML, and analytics (Secs. 76-k, 76-l)
- Operators must implement anti-fraud and AML policies, including KYC procedures and ongoing risk management.
- Use of blockchain analytics to detect and block illicit transfers; requirement to block transfers to overseas wallets not accessible to U.S. users.
- Designated line for regulator communications; routine monitoring.
Transaction limits and protections (Sec. 76-m)
- Daily limit: $1,000 per user across all operator kiosks, and a 30-day cap of $10,000.
- Limits apply to all products/services offered; evasion through portals or OTC deals is prohibited.
- Department may request transaction/user data; data kept confidential or only in composite form.
Ownership and penalties (Sec. 76-n)
- If an operator fails to comply with multiple provisions (registration, disclosures, AML, or analytics), consumer ownership of funds is presumed to be with the consumer, requiring return of principal and fees within seven business days; private action and attorney’s fees/costs possible for violations.
- For cashier exchanges, similar protections apply with corresponding penalties.
- Violations may carry penalties, with residual framework for penalties where no specific penalty is listed.
Effective date
- Takes effect 180 days after enactment.
Overall impact
- Creates a stringent regulatory regime for crypto kiosks/cashier exchanges in New York.
- Emphasizes consumer protection through disclosure, hold periods, refunds, and fee limits.
- Establishes AML/KYC, blockchain analytics, and fraud reporting requirements.
- Provides enforcement tools including registration penalties, private rights of action, and potential license revocation.
Note: This summary reflects the bill text as introduced in April 2026 and does not reflect any later amendments or enacted law.
Compiled from official sources — confirm details with the bill’s official record.
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