An Act providing for regulation and reporting requirements for qualifying virtual currency kiosk operators and for money transmitter license; and imposing duties on the Department of Banking and Securities.

PRINTER'S NO. 1172
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No. 1015
Session of
2025
INTRODUCED BY PENNYCUICK, VOGEL AND BROWN, SEPTEMBER 17, 2025
REFERRED TO COMMUNICATIONS AND TECHNOLOGY, SEPTEMBER 17, 2025
AN ACT
Providing for regulation and reporting requirements for
qualifying virtual currency kiosk operators and for money
transmitter license; and imposing duties on the Department of
Banking and Securities.
TABLE OF CONTENTS
Section 1. Short title.
Section 2. Definitions.
Section 3. Confidentiality.
Section 4. Disclosures of material risks.
Section 5. Disclosure of general terms and conditions.
Section 6. Warning disclosure.
Section 7. Receipts.
Section 8. Blockchain analytics.
Section 9. Customer service.
Section 10. Anti-fraud policy.
Section 11. Financial Exploitation of Elder and Vulnerable
Adults Policy.
Section 12. Compliance policies.
Section 13. Compliance officer.
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Section 14. Consumer protection officer.
Section 15. Reporting virtual currency kiosk locations.
Section 16. Money transmitter license.
Section 17. Armored car carrier.
Section 18. Effective date.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Short title.
This act shall be known and may be cited as the Virtual
Currency Kiosk Regulation Act.
Section 2. Definitions.
The following words and phrases when used in this act shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Armored car carrier." A corporation, limited liability
company, limited liability partnership or foreign entity
qualified to do business in this Commonwealth that is used by a
virtual currency kiosk operator to transport fiat currency to or
from a virtual currency kiosk.
"Blockchain." A distributed digital ledger or database which
is chronological, consensus-based, decentralized and
mathematically verified in nature.
"Blockchain analytics." A software service that uses data
from various virtual currencies and their applicable blockchains
to provide a risk rating specific to digital wallet addresses
from users of virtual currency kiosks.
"Department." The Department of Banking and Securities of
the Commonwealth.
"Digital wallet." Hardware or software that enables
individuals to store and use virtual currency.
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"Digital wallet address." An alphanumeric identifier
representing a destination on a blockchain for a virtual
currency transfer that is associated with a digital wallet.
"Fiat currency." A medium of exchange that is authorized or
adopted by the Federal Government as part of its currency and is
not backed by a commodity.
"NMLS." The Nationwide Multistate Licensing System and
Registry developed by the Conference of State Bank Supervisors
and the American Association of Residential Mortgage Regulators
and owned and operated by the State Regulatory Registry, LLC, or
any successor or affiliated entity, for the licensing and
registration of persons in financial services industries.
"Virtual currency." As follows:
(1) The term includes a digital representation of value
that:
(i) Is used as a medium of exchange, unit of account
or store of value.
(ii) Is not money, unless the virtual currency was
adopted or authorized by a domestic or international
government as a medium of exchange, whether denominated
in cash.
(2) The term does not include:
(i) 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 money,
bank credit or virtual currency.
(ii) 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.
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"Virtual currency kiosk." An electronic terminal of the
virtual currency kiosk operator that enables the owner or
operator to facilitate the exchange of fiat currency for virtual
currency or virtual currency for fiat currency or other virtual
currency, including, but not limited to:
(1) connecting directly to a separate virtual currency
exchange that performs the actual virtual currency
transmission; or
(2) drawing upon the virtual currency in the possession
of the owner or operator of the electronic terminal.
"Virtual currency kiosk operator." A corporation, limited
liability company, limited liability partnership or foreign
entity qualified to do business in this Commonwealth which
operates a virtual currency kiosk within this Commonwealth.
Section 3. Confidentiality.
(a) Restricted use.--Except as otherwise provided in this
section, all information or reports obtained by the department
from a virtual currency kiosk operator, and all information
contained in or related to an examination, investigation,
operating report or condition report prepared by, on behalf of
or for the use of the department, are confidential.
(b) Information availability.--Information contained in the
records of the department that is not confidential and may be
available to the public either on the department's publicly
accessible Internet website, upon receipt by the department of a
written request or in NMLS shall include:
(1) the name, business address, telephone number and
unique identifier of a virtual currency kiosk operator;
(2) the business address of a virtual currency kiosk
operator's registered agent for service; and
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(3) copies of any final orders of the department
relating to any violation of this act or regulations
implementing this act.
Section 4. Disclosures of material risks.
As part of establishing a relationship with a customer, and
prior to entering into an initial transaction for, on behalf of
or with the customer, a virtual currency kiosk operator shall
disclose in clear, conspicuous and legible writing in the
English language, whether in accessible terms of service or
elsewhere, all material risks associated with its products,
services and activities and virtual currency generally,
including disclosures substantially similar to the following:
(1) Virtual currency is not legal tender, is not backed
by the government and accounts and value balances are not
subject to Federal Deposit Insurance Corporation or
Securities Investor Protection Corporation protections.
(2) Legislative and regulatory changes or actions at the
Federal, State or international level may adversely affect
the use, transfer, exchange and value of virtual currency.
(3) Transactions in virtual currency may be
irreversible, and, accordingly, losses due to fraudulent or
accidental transactions may not be recoverable.
(4) Some virtual currency transactions shall be deemed
to be made when recorded on a public ledger, which is not
necessarily the date or time that the customer initiates the
transaction.
(5) The value of virtual currency may be derived from
the continued willingness of market participants to exchange
fiat currency for virtual currency, which may result in the
potential for permanent and total loss of value of a
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particular virtual currency should the market for that
virtual currency disappear.
(6) There is no assurance that a person who accepts a
virtual currency as payment today will continue to do so in
the future.
(7) The volatility and unpredictability of the price of
virtual currency may result in significant loss over a short
period of time.
(8) The nature of virtual currency may lead to an
increased risk of fraud or cyber attack.
(9) The nature of virtual currency means that any
technological difficulties experienced by the virtual
currency kiosk operator may prevent the access or use of a
customer's virtual currency.
(10) Any bond or trust account maintained by the virtual
currency kiosk operator for the benefit of its customers may
not be sufficient to cover all losses incurred by customers.
Section 5. Disclosure of general terms and conditions.
When opening an account for a new customer, and prior to
entering into an initial transaction for, on behalf of or with
the customer, a virtual currency kiosk operator shall disclose
in clear, conspicuous and legible writing in the English
language, whether in accessible terms of service or elsewhere,
all relevant terms and conditions associated with its products,
services and activities and virtual currency generally,
including disclosures substantially similar to the following:
(1) The customer's liability for unauthorized virtual
currency transactions.
(2) Under what circumstances the virtual currency kiosk
operator may, absent a court or government order, disclose
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information concerning the customer's account to third
parties.
(3) The customer's right to receive periodic account
statements and valuations from the virtual currency kiosk
operator.
(4) The customer's right to receive a receipt, trade
ticket or other evidence of a transaction.
(5) The customer's right to prior notice of a change in
the virtual currency kiosk operator's rules or policies.
(6) Other disclosures as are customarily given in
connection with the opening of customer accounts.
Section 6. Warning disclosure.
Prior to entering into a virtual currency transaction with a
customer, a virtual currency kiosk operator shall ensure that a
warning is disclosed to a customer substantially similar to the
following:
WARNING: CONSUMER FRAUD OFTEN STARTS WITH CONTACT FROM A
STRANGER WHO IS INITIATING A DISHONEST SCHEME. I
UNDERSTAND THAT BY TRANSACTING I AGREE TO THE FOLLOWING:
I confirm that I am purchasing cryptocurrency with my
own funds or am selling cryptocurrency that belongs to
me. I have not been asked to purchase cryptocurrency by
anyone else, including this company or my employer.
I confirm that I am using a digital wallet that I own
or have direct control over.
I understand that the purchase and sale of
cryptocurrency is a final irreversible and nonrefundable
transaction.
If someone has instructed you to use this kiosk in
relation to urgent payments such as: a utility bill, a
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law enforcement request, Social Security or IRS payment
or to pay for someone else's medical bills, travel
expenses or bail, it may be a scam and you should not
proceed with the transaction. If you have questions,
please call a customer services representative.
If you suspect that you are being targeted in a
cryptocurrency scam, please contact law enforcement.
Section 7. Receipts.
Upon completion of any virtual currency kiosk transaction, a
virtual currency kiosk operator shall provide to a customer a
digital or physical receipt containing the following
information:
(1) The name and contact information of the virtual
currency kiosk operator, including a telephone number
established by the virtual currency kiosk operator to answer
questions and register complaints.
(2) The type, value, date and precise time of the
transaction.
(3) The fee charged.
(4) The exchange rate, if applicable.
(5) A statement of the liability of the virtual currency
kiosk operator for nondelivery or delayed delivery.
(6) A statement of the refund policy of the virtual
currency kiosk operator.
Section 8. Blockchain analytics.
A virtual currency kiosk operator shall use blockchain
analytics software to assist in the prevention of sending
purchased virtual currency from a virtual currency kiosk
operator to a digital wallet known to be affiliated with
fraudulent activity at the time of a transaction. The department
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may request evidence from any virtual currency kiosk operator of
current use of blockchain analytics.
Section 9. Customer service.
A virtual currency kiosk operator performing business in this
Commonwealth shall provide live 24-hour customer service. The
customer service toll-free telephone number shall be displayed
on the virtual currency kiosk or the virtual currency kiosk
screens.
Section 10. Anti-fraud policy.
A virtual currency kiosk operator shall take reasonable steps
to detect and prevent fraud, including establishing and
maintaining a written anti-fraud policy. The anti-fraud policy
shall include:
(1) The identification and assessment of fraud-related
risk areas.
(2) Procedures and controls to protect against
identified risks.
(3) Allocation of responsibility for monitoring risks.
(4) Procedures for the periodic evaluation and revision
of the anti-fraud procedures, controls and monitoring
mechanisms.
Section 11. Financial Exploitation of Elder and Vulnerable
Adults Policy.
(a) Written policy.--A virtual currency kiosk operator shall
maintain, implement and enforce a written Financial Exploitation
of Elder and Vulnerable Adults Policy. The policy shall be
reviewed and approved by the virtual currency kiosk operator's
board of directors or an equivalent governing body of the
virtual currency kiosk operator.
(b) At-risk individuals.--The Financial Exploitation of
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Elder and Vulnerable Adults Policy shall identify at minimum
individuals who are at risk of financial exploitation based on
age or mental capacity and steps to prevent exploitation.
Section 12. Compliance policies.
(a) Compliance.--A virtual currency kiosk operator shall
comply with the provisions of this act, any lawful order, rule
or regulation made or issued under the provisions of this act
and all applicable Federal and State laws, rules and
regulations.
(b) Written policies.--A virtual currency kiosk operator
shall maintain, implement and enforce written compliance
policies and procedures. The policies and procedures shall be
reviewed and approved by the virtual currency kiosk operator's
board of directors or an equivalent governing body of the
virtual currency kiosk operator.
(c) Records.--A virtual currency kiosk operator shall
provide the department with records that the department may
reasonably require to ensure compliance with this act.
Section 13. Compliance officer.
(a) Requirements.--A virtual currency kiosk operator shall
designate and employ a compliance officer with the following
requirements:
(1) The individual must be qualified to coordinate and
monitor compliance with this act and all other applicable
Federal and State laws, rules and regulations.
(2) The individual must be employed full time by the
virtual currency kiosk operator.
(3) The designated compliance officer cannot be any
individual who owns more than 20% of the virtual currency
kiosk operator by whom the individual is employed.
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(b) Responsibilities.--Compliance responsibilities required
under Federal and State laws, rules and regulations shall be
completed by full-time employees of the virtual currency kiosk
operator.
Section 14. Consumer protection officer.
A virtual currency kiosk operator shall designate and employ
a consumer protection officer with each of the following
requirements:
(1) The individual must be qualified to coordinate and
monitor compliance with this act and all other applicable
Federal and State laws, rules and regulations.
(2) The individual must be employed full time by the
virtual currency kiosk operator.
(3) The designated consumer protection officer cannot be
an individual who owns more than 20% of the virtual currency
kiosk operator by whom the individual is employed.
Section 15. Reporting virtual currency kiosk locations.
(a) Locations.--A virtual currency kiosk operator shall
submit a report of the location of each virtual currency kiosk
located within this Commonwealth within 45 days of the end of
the calendar quarter. The department shall formulate a system
for virtual currency kiosk operators to submit the locations
that is consistent with the requirements of this section.
(b) Content of report.--The location report shall include,
at a minimum, the following regarding the location of a virtual
currency kiosk:
(1) Company legal name.
(2) Any fictitious or trade name.
(3) Physical address.
(4) Start date of operation of the virtual currency
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kiosk at the location.
(5) End date of operation of the virtual currency kiosk
at the location, if applicable.
Section 16. Money transmitter license.
(a) Requirement.--A virtual currency kiosk operator that
owns, operates, solicits, markets, advertises or facilitates
virtual currency kiosks in this Commonwealth shall be deemed to
be engaged in money transmission and require licensure under
this act and the act of September 2, 1965 (P.L.490, No.249),
known as the Money Transmission and Virtual Currency
Transmission Business Licensing Law.
(b) Application.--An unlicensed virtual currency kiosk
operator shall apply for a money transmitter license within 60
days after the effective date of this subsection. A virtual
currency kiosk operator that applies within this time period
shall be allowed to continue operations while the department
reviews the virtual currency kiosk operator's application. If a
virtual currency kiosk operator's application is denied, the
virtual currency kiosk operator shall cease operations until
granted a money transmitter license.
Section 17. Armored car carrier.
An armored car carrier shall only engage in business with a
virtual currency kiosk operator that has obtained proper
licensure or registration in this Commonwealth or that applied
for proper licensure in this Commonwealth prior to the effective
date of this section.
Section 18. Effective date.
This act shall take effect in 60 days.
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