Tennessee's Crypto ATM Ban Survives First Legal Test as Court Allows Measure to Take Effect

A federal court in Tennessee has allowed the state's ban on cryptocurrency ATMs to take effect, giving Attorney General Jonathan Skrmetti an early legal victory in the state's anti-fraud push.

The ban, which went into effect on July 1, prohibits the installation and operation of virtual currency kiosks in Tennessee. The measure aims to protect consumers from scams that have cost victims millions of dollars nationwide.

Coinflip, one of the world's largest cryptocurrency ATM operators with over 5,500 Bitcoin ATMs across 48 U.S. states and several countries, joined a lawsuit along with Private IT Corporation against the ban. However, the court found that the plaintiffs failed to meet the legal standard for emergency injunctive relief.

The court ruled that while the businesses showed economic harm, it did not outweigh the public interest in allowing the law to take effect. The case will continue while the statute remains enforceable.