Bitcoin ATM operators to benefit from pending Florida legislation

By Jeremy Snyder, CEO of BTM Compliance LLC

In a move that is sure to please owners of Bitcoin ATMs, Florida legislators have voted to clarify the state's position on cryptocurrency sales. This means that soon, crypto assets can be bought and sold between two parties in the Sunshine State without fear of regulatory repercussions.

With this vote and the Governor Ron DeSantis' pending signature, Florida will become one of the most crypto-friendly states in the US. This is great news for traditional ATM owners looking to get into the Bitcoin ATM industry and anyone else who is interested in bitcoin, cryptocurrencies and blockchain technology.

So what does this mean for you? Read on to find out!

House Bill 273 (HB 273), sponsored by Florida Representative Vance Aloupis, creates a legal distinction between two parties buying, selling or trading cryptocurrencies versus transactions facilitated through a broker or third-party. Some of the details include:

• A two-party transaction is deemed distinct from a transaction involving a third party acting as a broker.
• This is particularly important for owners of Bitcoin ATMs and other cryptocurrency kiosks, who sell cryptocurrencies they own.
• For such Money Service Businesses (MSBs) in that business model with cryptocurrency they own, customer-to-kiosk transactions would no longer be considered money transmissions.

In August of 2021, the Florida Office of Financial Regulation (OFR) announced it had changed its legal interpretation of business activity with regard to selling virtual currency. This occurred after the Florida Third District Court of Appeal's decision in the Florida v. Espinoza case. The Court held that a transaction involving monetary value does not require a third-party to be considered money transmission.

Subsequently, OFR provided notification that MSBs engaged in selling virtual currency in Florida would need to apply for a Money Transfer License (MTL) no later than December 31st, 2021. Additionally, as of Jan. 1st, 2022, any new MSBs operating in the state would be required to have an MTL. OFR warned that those selling virtual currency without a license may be subject to administrative fines, penalties or potentially face criminal prosecution.

HB 273 is currently waiting for a signature into law from Florida Governor Ron DeSantis (R). Once signed, the effective date for this change will take place on Jan. 1st, 2023.