Florida’s New Virtual Currency Kiosk Business Bill

In a significant move to regulate virtual currency kiosk businesses, Florida has introduced a new bill during the 2024 Regular Session. Bill S0662 is sponsored by republican representative Colleen Burton. The bill is set to bring substantial changes to the way virtual currency kiosk businesses operate.

Overview of Bill S0662. Bill S0662, introduced on December 1, 2023, seeks to amend Section 560.103 of the Florida Statutes by defining relevant terms and bringing virtual currency kiosk businesses under the supervision of the Office of Financial Regulation of the Financial Services Commission. The bill not only mandates registration with the state but also outlines stringent application requirements, renewal processes, and significant criminal penalties for non-compliance.

Key Provisions of the Bill

    • Mandatory Registration: Virtual currency kiosk businesses are prohibited from operating without state registration.
    •  Licensing Requirements: The bill requires Virtual Currency Kiosk Businesses to be licensed as money services businesses, thereby extending the regulatory net.
    • Criminal Penalties: The bill introduces criminal penalties for money transmitters operating or soliciting business as virtual currency kiosk businesses under specific conditions. It also penalizes fraudulent registration attempts.
    • Non-transferability of Registration: Registrations for virtual currency kiosk businesses are not transferable or assignable, ensuring accountability and traceability.
    • Disclosure Requirements: Virtual currency kiosks must display specific disclosures and attestations, enhancing transparency for users.
    • Business Name Regulations: Registrants must transact business under their legal names, with certain exceptions provided.
    • Penalties for Violations: Violating specific provisions can result in criminal penalties, and courts have the authority to invalidate registrations under certain conditions.

Implications for Businesses and Consumers. The bill marks a notable regression for Florida’s virtual currency kiosk industry. Since the Espinoza case in 2016, there has been persistent ambiguity surrounding the state’s regulations, which were only recently resolved with the implementation of a new bill in 2023, thanks to the diligent efforts of the Florida Blockchain Business Association. It is disheartening to observe the crypto industry being singled out for more stringent regulations. Such measures are likely to harm consumers and impose additional financial burdens on operators who are already complying with extensive federal registration requirements through FinCEN.

Conclusion. Florida’s Bill S0662 is a step in the wrong direction, especially for those in the Bitcoin ATM industry who have been diligently complying with existing regulations. It’s disconcerting to see the sector, which has been a beacon of innovation and financial inclusion, being unnecessarily hampered by overzealous and unjustly targeted regulations. These new rules not only undermine the progress the industry has made but also threaten to impose undue hardships on both operators and consumers with restrictive measures that serve little purpose other than to stifle growth and innovation.

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