KY SB189

Establishes a licensing framework for virtual currency kiosk (crypto ATM) operators in Kentucky, requiring a license from the Commissioner of Financial Institutions to own, operate, or facilitate crypto ATMs in the state, effective March 31, 2027

Imposes consumer protection requirements including a $3,000 maximum daily transaction limit per user, mandatory fraud warning notices on kiosks, and a 72-hour waiting period or cancellation window for transactions

Requires licensees to maintain a surety bond of $100,000 to $7 million based on transaction volume, plus tangible net worth of at least $100,000 or a percentage of total assets, and prohibits commingling customer assets with licensee funds

Mandates anti-fraud and anti-money laundering compliance measures including blockchain analytics software to detect fraudulent wallet addresses, enhanced due diligence policies, and cybersecurity protocols

Grants the commissioner enforcement authority including license denial, suspension, or revocation; emergency orders to seize or disable kiosks; cease and desist orders; and civil penalties of $1,000 to $5,000 per violation per day