by Walter Blanks Jr.
Since he began representing Tennessee in the U.S. Senate in 2021, Senator Bill Hagerty has wasted no time putting his expertise in economics, investing, and business to good use. Thanks to Senator Hagerty’s leadership, cryptocurrency is on the precipice of its biggest legislative win ever with the GENIUS Act. This comprehensive package – which has been signed by President Trump – establishes common-sense safeguards for stablecoins, upholding the integrity of digital assets and ensuring consumer safety.
And the Senator signaled he’s not yet finished with cryptocurrency policy this Congress. Recently, Senator Hagerty and three of his colleagues unveiled the framework for legislation establishing a crypto market structure that will keep the industry safe for consumers in the United States.
The framework is heavy on ideas for addressing bad actors who abuse the industry, combating illicit finance schemes and protections for consumers when trading digital currencies. However, as Senator Hagerty notes, the final market structure legislation must be a “reasonable, light-touch.” When it comes to what Congress should not do in this bill, look no further than how state legislators occasionally favor a heavy-handed approach on the issue of regulating cryptocurrency kiosks.
These devices, located in convenient locations throughout communities, enable consumers to easily convert cash into a cryptocurrency investment. Many depend on kiosks out of personal preference. This includes individuals who want to invest in crypto without surrendering their personal or financial information to an online exchange, which should not be a barrier to participating in digital asset markets. Without kiosks, some consumers may miss opportunities to buy and sell crypto or completely lose access to the market.
Unfortunately, some states have gone too far in their efforts to establish consumer protections at kiosks. By chasing daily transaction limits, fee caps, and moratoriums on new kiosks, some states limited kiosk operators’ ability to offer services to customers. This was the case in Vermont, whose residents felt the loss of kiosk access firsthand. A restrictive law led to kiosk shutdowns, taking away financial independence from citizens. Fortunately, the law was quickly amended, but the policy failure demonstrated how harmful such a policy is for consumers. Fee caps for financial services go against free-market economics championed by conservative lawmakers, and Senator Hagerty has a history of standing up for this principle in the Senate.
Currently, there are over 30,000 kiosks in the United States, with roughly 800 kiosks located in Tennessee. As part of his crypto market structure legislation, Senator Hagerty should pursue federal regulations that strengthen consumer protections at kiosks without limiting access.
The blueprint for protections already exists. Good faith kiosk operators deploy a number of tactics to protect their users from financial crimes. Acknowledgment of an anti-scam disclosure before any transaction can proceed, utilizing blockchain analytics to prevent transactions to risky digital wallets, and maintaining live 24/7 customer service teams to monitor for suspicious activity are a few successful practices kiosk operators are implementing to keep their customers and their financial assets safe. Best of all, these measures do not prevent kiosks from offering their services to consumers.
These consumer protection safeguards must be required for all kiosk operators. Congress should strongly consider enshrining these consumer protection policies as federal regulations for every company operating a cash-for-crypto service, aligning with the crypto market structure framework he has previously endorsed.
Cryptocurrency is the future of the American economy. However, policies that purport to protect consumers but hold the industry back from reaching its full potential stand to hurt unleashing our nation’s full financial potential. Instead, our leaders must pursue common-sense rules that foster growth, innovation, and honest business practices that allow this sector to flourish responsibly and reasonably. As Senator Hagerty, and his colleagues in Congress, look to push crypto further into the financial mainstream, Congress must ensure that they preserve all legitimate businesses that meet consumers’ demand for crypto, including kiosks.
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Walter Blanks Jr. serves as Executive Director of Black Americans United for Tennessee.
Won’t that facilitate the drug trade?? We can’t bring back the $500 bill because of the drug runners…. I’d say this is worse!