RELATING TO CONSUMER PROTECTION.

SB3185

THE SENATE

S.B. NO.

3185

THIRTY-THIRD LEGISLATURE, 2026

STATE OF HAWAII

A BILL FOR AN ACT

relating
to CONSUMER PROTECTION
.

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

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SECTION 1.
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The
legislature finds that access to lawful digital asset transactions is an
essential component of financial inclusion, innovation, and individual economic
freedom in the modern economy.
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Digital
asset kiosks offer a vital point of access for individuals who may lack
traditional banking services or prefer to engage with digital assets in a
secure, in-person environment.

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The legislature believes that individuals
have a right to use their fiat currency to obtain digital assets lawfully and
that businesses have a right to operate compliant digital asset kiosks to serve
the public.
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The legislature further
believes that clear, consistent, and narrowly tailored regulation of digital
asset kiosks helps protect consumers from fraud while preserving lawful access
to emerging financial technologies.

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Accordingly, the purpose of this Act is to provide
the public with access to safe, transparent, and non-discriminatory transactions
of digital assets through the regulation of the licensure, operation, and
investigation of digital asset kiosks and their operators.

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SECTION 2.
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The Hawaii Revised Statutes is amended by adding a new chapter to be
appropriately designated and to read as follows:

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Chapter

DIGITAL ASSET KIOSK CONSUMER ACCESS AND
PROTECTION ACT

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� -1
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Short title.
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This chapter shall be known and may be cited
as the Digital Asset Kiosk Consumer Access and Protection Act.

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� -2
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Definitions.
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As used in this chapter:

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"Consumer" means an individual or
entity that conducts a transaction involving digital assets through a digital
asset kiosk.

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"Department" means the department
of commerce and consumer affairs.

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"Digital asset" includes virtual
currencies, cryptocurrencies, stablecoins, fungible tokens, non-fungible
tokens, and other strictly digital assets that confer economic, proprietary, or
access rights and powers to owners.

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"Digital asset kiosk" means an
electronic terminal that enables a consumer to interchange fiat currency for
digital assets.
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"Digital asset
kiosk" includes a machine that either connects to an external digital
asset trading platform for the execution of a transaction, or dispenses digital
assets from the holdings of an operator.

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"Fiat currency" means
government-issued currency that is designated as legal tender in the United
States and not backed by a physical commodity.

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"Operator" means a person or
entity who owns or operates one or more digital asset kiosks within the State.

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� -3
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Operator requirements.
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(a)
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Beginning ,
2026, no operator shall operate any digital asset kiosk in the State unless the
operator holds either a valid:

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(1)
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Money
transmitter license pursuant to section 489D-3; or

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(2)
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Virtual
currency business license.

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(b)
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An operator that fails to meet the requirements of this section shall be
subject to enforcement and penalties pursuant to this chapter.

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(c)
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For the purposes of this section, "virtual currency business
license" means a license, registration, or other authorization issued
under the laws of the State to engage in digital asset or virtual currency
business activity.

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� -4
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Reports.
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(a)
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Beginning
, 2026, each
operator shall submit to the department an annual report that includes the
location of each digital asset kiosk owned or operated by the operator in the
State.
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The report shall be filed in a
form and by a date prescribed by the department; provided that the submission
shall be required to occur at least once per calendar year.

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(b)
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The annual report submitted by the operator to the department shall
include, for each digital asset kiosk:

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(1)
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The
name and physical address, including the street address, city, and zip code, of
the location of the digital asset kiosk, including the name of the business or
establishment in which the digital asset kiosk is located, if applicable;

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(2)
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The
date on which the digital asset kiosk began operation; and

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(3)
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The
date on which the digital asset kiosk ceased operation, if applicable.

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� -5
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Disclosures; warning; customer service
contact information.
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(a)
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Beginning
, 2026, the operator
of a digital asset kiosk shall ensure that the user interface for each digital
asset kiosk prominently displays the following information to the consumer before
any transaction:

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(1)
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All
fees or charges the consumer will incur for the transaction;

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(2)
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The
applicable exchange rate or price used to convert between any type of fiat
currency and a digital asset, if applicable;

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(3)
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A
notice that transactions involving digital assets are irrevocable and cannot be
reversed or refunded once completed;

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(4)
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A
notice that digital assets and transactions conducted at the digital asset
kiosk are not insured or guaranteed by the Federal Deposit Insurance
Corporation, National Credit Union Administration, or Securities Investor
Protection Corporation; and

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(5)
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A
fraud warning that shall:

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(A)
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Describe,
in general terms, common scam tactics involving digital asset kiosks;

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(B)
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Advise
a consumer not to proceed with any transaction if the consumer is being
instructed or pressured by a third party, or if the consumer suspects fraud;

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(C)
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State
that no government agency or official will ever request a payment through a
transaction conducted on a digital asset kiosk; and

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(D)
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Direct
a consumer who suspects fraud to the customer service contact information
displayed on the digital asset kiosk pursuant to subsection (b).

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(b)
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Each digital asset kiosk shall display customer service contact
information, including a valid telephone number that connects to the customer
service center of the applicable operator or to a designated, non-emergency law
enforcement agency.
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The telephone number
shall be displayed prominently on the digital asset kiosk or its electronic
display and before and during each transaction.

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� -6
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Receipts; new consumer transaction
limits.
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(a)
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Beginning
, 2026, and upon
completion of any transaction using a digital asset kiosk, the operator shall
provide the consumer with a receipt in a printed or electronic form.
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Each receipt shall include:

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(1)
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The
date and time of the transaction;

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(2)
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The
type and amount of digital asset transacted and the corresponding amount of
fiat currency exchanged, if applicable;

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(3)
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The
fees charged for the transaction;

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(4)
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The
exchange rate applied, if any; and

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(5)
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The
name of the operator and the customer service contact information for the
operator.

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(b)
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Each operator shall implement transaction limits for every digital asset
kiosk owned or operated by the operator, which shall prohibit new consumers
from conducting transactions using a digital asset kiosk that total more than
$3,000 per calendar day; provided that the transaction limits shall no longer
apply after five calendar days from the first transaction; provided further
that, for the purposes of this subsection, "new consumer" means a
consumer conducting an initial transaction with the operator for the first time
and any subsequent transactions with the operator for the next five calendar
days from the initial transaction.

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� -7
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Recordkeeping; law enforcement cooperation.
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(a)
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Beginning
, 2026, each
operator shall maintain complete and accurate records of all transactions
conducted at digital asset kiosks that the operator owns or operates and any
related consumer information as required under applicable state and federal
laws; provided that the records of all transactions shall be preserved for a
period of time as determined by the department by rule.

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(b)
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Each
operator shall cooperate with all law enforcement agencies in any investigation
and prevention of fraud and other unlawful activity, including but not limited
to:

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(1)
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Complying
promptly with lawful subpoenas, court orders, and other official requests for
records or information relating to consumers or transactions conducted at
digital asset kiosks;

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(2)
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Responding
in good faith to lawful requests from the department or a law enforcement
agency relating to fraud involving a digital asset kiosk; and

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(3)
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Designating
a point of contact within the organization of the operator for communication
with the department and any law enforcement agency regarding fraud.

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(c)
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No provision of this section shall be construed to require an operator
to monitor or block transactions conducted at digital asset kiosks in real
time, except as required by other applicable law.

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� -8
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Authority of the department; violations; joint
liability.
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(a)
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Beginning
, 2026, the
department may investigate and examine the operations, records, and property of
any operator as reasonably necessary to verify compliance with this chapter and
any rules adopted under this chapter.
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In
conducting an investigation pursuant to this section, the department may:

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(1)
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Require
an operator to submit reports or documentation relevant to the business,
activities, and transactions concerning any digital asset kiosk owned or
operated by the operator;

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(2)
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Inspect
the books, records, and digital asset kiosks of the operator during normal
business hours; and

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(3)
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Take
testimony or issue subpoenas to compel the appearance of witnesses and the
production of documents.

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(b)
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If the department determines that an operator has violated this chapter
or any rule adopted under this chapter, the department may take one or more of
the following enforcement actions in accordance with applicable administrative
procedures:

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(1)
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Issue
an order requiring the operator to cease and desist from the violative action
and to take corrective action as necessary to comply with this chapter and all
rules adopted under this chapter;

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(2)
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Impose
an administrative fine or penalty; provided that each day that a violation
continues may be treated as a separate violation; provided further that the
maximum penalty for each violation shall not exceed $1,000; or

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(3)
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Suspend
or revoke any license or registration required to operate digital asset kiosks
in the State pursuant to section -3.

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(c)
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The remedies and penalties provided in this section are cumulative and shall
not limit enforcement under other applicable state law, including laws relating
to money transmission or to unfair or deceptive acts or practices.

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(d)
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Nothing in this chapter shall be construed to limit the rights of any
person to pursue civil remedies against an operator or to restrict the
authority of the attorney general or other applicable state officials from
bringing civil or criminal proceedings under applicable state law.

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(e)
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Any
business or establishment wherein a digital asset kiosk is located shall be jointly
liable for any damages arising from transactions conducted using the digital
asset kiosk that are determined to have been fraudulent or for which the
operator is found to be liable.

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(f)
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An operator, a business, or an establishment may challenge any final
order or enforcement action taken by the department under this section by
filing an appeal in a court of competent jurisdiction in accordance with
applicable state law.

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(g)
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The department may adopt rules pursuant to chapter 91, necessary for the
purposes of this chapter."

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SECTION 3.
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If any provision of this Act, or the application thereof to any person
or circumstance, is held invalid, the invalidity does not affect other
provisions or applications of the Act that can be given effect without the
invalid provision or application, and to this end the provisions of this Act
are severable.

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SECTION 4.
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This Act shall take effect upon approval.

INTRODUCED BY:

_____________________________

Report Title:

DCCA; Digital
Asset Kiosks; Disclosures; Licenses; Fraud; Investigations; Penalties; Reports;
Operator Responsibilities; Joint Liability

Description:

Requires
operators of digital asset kiosks to have requisite licenses or registrations;
make annual reports to the Department of Commerce and Consumer Affairs; limit
transaction amounts for new consumers; provide disclosures, receipts, and
customer service contact information to all consumers; and cooperate with the
Department of Commerce and Consumer Affairs and applicable law enforcement
agencies in the investigation of fraudulent transactions.
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Authorizes the Department of Commerce and
Consumer Affairs to investigate and take enforcement actions against
operators.
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Extends joint liability to
businesses or establishments wherein digital asset kiosks are located that are determined
to have processed a fraudulent transaction or a transaction for which an
operator is found to be liable.

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