HB 1277: Digital Financial Asset Transaction Kiosk; Daily Maximum; Cryptocurrency

A BILL FOR AN ACT

RELATING TO DIGITAL FINANCIAL ASSET.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  Chapter 481B, Hawaii Revised Statutes, is amended by adding a new section to part I to be appropriately designated and to read as follows:

     "§481B-     Digital financial asset transaction kiosks; daily cap.  (a)  An operator shall accept or dispense no more than $1,000 per day from or to a single customer through a digital financial asset transaction kiosk.

     (b)  As used in this section:

     "Cash" means physical United States currency, both coins and paper currency.

     "Digital financial asset" means a digital representation of value that is used as a medium of exchange, unit of account, or store of value, and that is not legal tender, regardless of whether denominated in legal tender.  "Digital financial asset" does not include:

     (1)  A transaction in which a merchant grants, as part of an affinity or rewards program, value that cannot be taken from or exchanged with the merchant for legal tender, bank or credit union credit, or a digital financial asset;

     (2)  A digital representation of value issued by or on behalf of a publisher and used solely within an online game, game platform, or family of games sold by the same publisher or offered on the same game platform; or

     (3)  A security registered with or exempt from registration with the United States Securities and Exchange Commission or a security registered or exempt from registration under chapter 485A.

     "Digital financial asset transaction kiosk" means an electronic information processing device that is capable of accepting or dispensing cash in exchange for a digital financial asset.

     "Operator" means a person who owns, operates, or manages a digital financial asset transaction kiosk located in the State."

     SECTION 2.  New statutory material is underscored.

     SECTION 3.  This Act shall take effect on July 1, 3000.

Report Title:

Digital Financial Asset Transaction Kiosk; Daily Maximum; Cryptocurrency

Description:

Imposes a daily maximum of $1,000 on transactions through a digital financial asset transaction kiosk.  Effective 7/1/3000.  (HD2)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO DIGITAL FINANCIAL ASSET.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  Chapter 481B, Hawaii Revised Statutes, is amended by adding a new section to part I to be appropriately designated and to read as follows:

     "§481B-     Digital financial asset transaction kiosks; daily cap.  (a)  An operator shall accept or dispense no more than $1,000 per day from or to a single customer through a digital financial asset transaction kiosk.

     (b)  As used in this section:

     "Cash" means physical United States currency, both coins and paper currency.

     "Digital financial asset" means a digital representation of value that is used as a medium of exchange, unit of account, or store of value, and that is not legal tender, regardless of whether denominated in legal tender.  "Digital financial asset" does not include:

     (1)  A transaction in which a merchant grants, as part of an affinity or rewards program, value that cannot be taken from or exchanged with the merchant for legal tender, bank or credit union credit, or a digital financial asset;

     (2)  A digital representation of value issued by or on behalf of a publisher and used solely within an online game, game platform, or family of games sold by the same publisher or offered on the same game platform; or

     (3)  A security registered with or exempt from registration with the United States Securities and Exchange Commission or a security qualified with or exempt from qualifications with the department of commerce and consumer affairs.

     "Digital financial asset transaction kiosk" means an electronic information processing device that is capable of accepting or dispensing cash in exchange for a digital financial asset.

     "Operator" means a person who owns, operates, or manages a digital financial asset transaction kiosk located in the State."

     SECTION 2.  New statutory material is underscored.

     SECTION 3.  This Act shall take effect on July 1, 3000.

Report Title:

Digital Financial Asset Transaction Kiosk; Daily Maximum; Cryptocurrency

Description:

Imposes a daily maximum of $1,000 on transactions through a digital financial asset transaction kiosk.  Effective 7/1/3000.  (HD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

relating to digital financial asset.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  Chapter 481B, Hawaii Revised Statutes, is amended by adding a new section to part I to be appropriately designated and to read as follows:

     "§481B-     Digital financial asset transaction kiosks; daily cap.  (a)  An operator shall accept or dispense no more than $2,000 per day from or to a single customer through a digital financial asset transaction kiosk.

     (b)  As used in this section:

     "Cash" means physical United States currency, both coins and paper currency.

     "Digital financial asset" means a digital representation of value that is used as a medium of exchange, unit of account, or store of value, and that is not legal tender, regardless of whether denominated in legal tender.  "Digital financial asset" does not include:

     (1)  A transaction in which a merchant grants, as part of an affinity or rewards program, value that cannot be taken from or exchanged with the merchant for legal tender, bank or credit union credit, or a digital financial asset;

     (2)  A digital representation of value issued by or on behalf of a publisher and used solely within an online game, game platform, or family of games sold by the same publisher or offered on the same game platform; or

     (3)  A security registered with or exempt from registration with the United States Securities and Exchange Commission or a security qualified with or exempt from qualifications with the department of commerce and consumer affairs.

     "Digital financial asset transaction kiosk" means an electronic information processing device that is capable of accepting or dispensing cash in exchange for a digital financial asset.

     "Operator" means a person who owns, operates, or manages a digital financial asset transaction kiosk located in the State."

     SECTION 2.  New statutory material is underscored.

     SECTION 3.  This Act shall take effect upon its approval.

Report Title:

Digital Financial Asset Transaction Kiosk; Daily Maximum; Cryptocurrency

Description:

Imposes a daily maximum of $2,000 on transactions through a digital financial asset transaction kiosk.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

STAND. COM. REP. NO.  1059

Honolulu, Hawaii

                , 2025

RE:   H.B. No. 1277

      H.D. 2

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Madame:

     Your Committee on Judiciary & Hawaiian Affairs, to which was referred H.B. No. 1277, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO DIGITAL FINANCIAL ASSET,"

begs leave to report as follows:

     The purpose of this measure is to limit the value of daily transactions through a digital financial asset transaction kiosk to a maximum of $1,000.

     Your Committee received testimony in support of this measure from AARP Hawaiʻi; Hawaiʻi Family Caregiver Coalition; Hawaii Credit Union League; Holomua Collaborative; Hawaii Bankers Association; and six individuals.  Your Committee received testimony in opposition to this measure from CoinFlip.  Your Committee received comments on this measure from the Department of Commerce and Consumer Affairs.

     Your Committee finds that digital financial asset transaction kiosks, also known as crypto ATMs, appear as regular ATMs and allow people to conduct legitimate cryptocurrency transactions by depositing fiat to purchase cryptocurrencies that are then transferred to a digital wallet.  However, crypto ATMs are largely unregulated at the state level compared to traditional financial institutions and money service businesses, which allows the crypto ATMs to lack consumer fraud protections.  As a result, crypto ATMs can put Hawaii consumers at risk of fraudulent purchase schemes.  This measure provides a means for protecting consumers by limiting the daily amount that may be transacted through crypto ATMs.

     Your Committee has amended this measure to clarify the exemption under the definition of "digital financial asset" for securities registered or exempt from registration under Hawaii law.

     As affirmed by the record of votes of the members of your Committee on Judiciary & Hawaiian Affairs that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1277, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 1277, H.D. 2.

Respectfully submitted on behalf of the members of the Committee on Judiciary & Hawaiian Affairs,

STAND. COM. REP. NO.  420

Honolulu, Hawaii

                , 2025

RE:   H.B. No. 1277

      H.D. 1

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Madame:

     Your Committee on Consumer Protection & Commerce, to which was referred H.B. No. 1277 entitled:

"A BILL FOR AN ACT RELATING TO DIGITAL FINANCIAL ASSET,"

begs leave to report as follows:

     The purpose of this measure is to limit the value of daily transactions through a digital financial asset transaction kiosk to a maximum of $2,000 per day.

     Your Committee received testimony in support of this measure from AARP Hawaiʻi and one individual.  Your Committee received testimony in opposition to this measure from CoinFlip and Bitcoin Depot.

     Your Committee finds that a digital financial asset transaction kiosk is a type of electronic kiosk where customers can buy and sell digital financial assets, or cryptocurrencies, using cash, credit cards, or bank transfer.  While the operators of these kiosks are not subject to any state oversight or regulation in their business practices, federal law does require operators to comply with laws designed to combat money laundering and terrorist financing.  Yet, consumers have no protections designed to protect their financial interests when transacting at these kiosks.

     Your Committee further finds that, while these kiosks enable people to make legitimate financial transactions every day, these kiosks are also increasingly being used in scams targeting older adults.  In these scams, victims are convinced to use the kiosks to transfer cryptocurrencies to a wallet address controlled by the scammer.  This measure imposes a daily transaction limit to prevent large sums of money from being withdrawn or deposited in a single day.

     Your Committee has amended this measure by:

     (1)  Lowering the daily limit imposed by this measure from $2,000 to $1,000; and

     (2)  Changing the effective date to July 1, 3000, to encourage further discussion.

     As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1277, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1277, H.D. 1, and be referred to your Committee on Judiciary & Hawaiian Affairs.

Respectfully submitted on behalf of the members of the Committee on Consumer Protection & Commerce,