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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to virtual currency kiosk businesses; 2
amending s. 560.103, F.S.; defining terms; amending s. 3
560.105, F.S.; requiring the Office of Financial 4
Regulation of the Financial Services Commission to 5
supervise registrants; authorizing the commissi on to 6
adopt rules; creating part V of ch. 560, F.S., 7
entitled "Virtual Currency Kiosk Businesses"; creating 8
s. 560.501, F.S.; providing legislative intent; 9
creating s. 560.502, F.S.; prohibiting a virtual 10
currency kiosk business from operating without 11
registering with the state; providing exemptions; 12
requiring certain entities to be licensed as money 13
services businesses; providing criminal penalties for 14
money transmitters that operate or solicit business as 15
a virtual currency kiosk business under certain 16
circumstances; providing criminal penalties for 17
persons who register or attempt to register as a 18
virtual currency kiosk business by certain means; 19
providing that a virtual currency kiosk business 20
registration is not transferable or assignable; 21
creating s. 560.503, F.S.; specifying application 22
requirements for registering as a virtual currency 23
kiosk business; requiring a registrant to report 24
certain changes in information within a specified 25
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timeframe; specifying requirements for a registrant to 26
renew its registration; requiring that the 27
registration of a virtual currency kiosk business be 28
made inactive if such business does not renew its 29
registration by a certain date; specifying 30
requirements for a virtual currency kiosk business to 31
renew its registration after becoming inactive; 32
providing that a registration becomes null and void 33
under certain circumstances; prohibiting the office 34
from accepting certain applications under certain 35
circumstances; requiring that certain applications be 36
denied under certain circums tances; providing that 37
certain false statements made by the virtual currency 38
kiosk business render registration void; providing 39
construction; authorizing the commission to adopt 40
rules; creating s. 560.504, F.S.; specifying 41
requirements for certain disclosu res and attestations 42
displayed by the virtual currency kiosk; authorizing 43
the commission to adopt rules; creating s. 560.505, 44
F.S.; requiring a registrant to transact business 45
under its legal name; providing exceptions; creating 46
s. 560.506, F.S.; requiring a registrant to hold new 47
customers' assets in initial transactions in 48
segregated wallets for a specified period before 49
initiating transactions; authorizing customers to 50
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request refunds during such holding periods; 51
authorizing such customers' assets to be sold at 52
market value and returned to the customers; requiring 53
certain customers to be queried for specified 54
information under certain circumstances; creating s. 55
560.507, F.S.; providing criminal penalties for 56
violation of certain provisions or performing c ertain 57
acts; authorizing a court to invalidate the 58
registration of a registrant under certain 59
circumstances; providing an effective date. 60
61
Be It Enacted by the Legislature of the State of Florida: 62
63
Section 1. Present subsections (4) through (36) of section 64
560.103, Florida Statutes, are redesignated as subsections (5) 65
through (37), respectively, and a new subsection (4) and 66
subsections (38) through (41) are added to that section, to 67
read: 68
560.103 Definitions. —As used in this chapter, the term: 69
(4) "Blockchain analytics" refers to the process of 70
examining, monitoring, and gathering insights from the data and 71
transaction patterns on a blockchain network. The primary aim of 72
blockchain analytics is to understand and monitor the network's 73
health, track money flows, and identify potential security 74
threats, including illicit activity, to extract actionable 75
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insights. 76
(38) "Virtual currency kiosk" means an electronic terminal 77
that acts as a mechanical agent of the owner -operator, enabling 78
the owner-operator to facilitate the exchange of virtual 79
currency for fiat currency or other virtual currency for a 80
customer. 81
(39) "Virtual currency kiosk business" or "registrant" 82
means a corporation, limited liability company, limited 83
liability partnership, or foreig n entity qualified to do 84
business in this state which operates a virtual currency kiosk 85
and which is not a money transmitter as defined in this section. 86
(40) "Virtual currency kiosk transaction" means the 87
process in which a customer uses a virtual curren cy kiosk to 88
exchange virtual currency for fiat currency or other virtual 89
currency. A transaction begins at the point at which the 90
customer is able to initiate a transaction, after the customer 91
is given the option to select the type of transaction or 92
account, and does not include any of the screens that display 93
the required terms and conditions, disclaimers, or attestations. 94
(41) "Wallet" means hardware or software that enables 95
customers to store and use virtual currency. 96
Section 2. Paragraph (a) of su bsection (1) and paragraph 97
(b) of subsection (2) of section 560.105, Florida Statutes, are 98
amended to read: 99
560.105 Supervisory powers; rulemaking. — 100
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(1) The office shall: 101
(a) Supervise all money services businesses and their 102
authorized vendors and registrants. 103
(2) The commission may adopt rules pursuant to ss. 104
120.536(1) and 120.54 to administer this chapter. 105
(b) Rules adopted to regulate money services businesses, 106
including deferred presentment providers and registrants, must 107
be responsive to cha nges in economic conditions, technology, and 108
industry practices. 109
Section 3. Part V of chapter 560, Florida Statutes, 110
consisting of ss. 560.501 -560.507, Florida Statutes, is created 111
and entitled "Virtual Currency Kiosk Businesses." 112
Section 4. Section 560.501, Florida Statutes, is created 113
to read: 114
560.501 Legislative intent. —The Legislature intends to 115
reduce unlawful and fraudulent activities by requiring virtual 116
currency kiosk businesses to register with the state and by 117
requiring such busine sses and money transmitter licensees to 118
regularly and consistently disclose to all customers of virtual 119
currency kiosks certain specified risks relating to virtual 120
currency kiosk transactions. 121
Section 5. Section 560.502, Florida Statutes, is created 122
to read: 123
560.502 Registration required; exemptions; penalties. — 124
(1) A virtual currency kiosk business in this state may 125
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not operate without first registering, or renewing its 126
registration, in accordance with s. 560.503 and being issued a 127
certificate of registration by the office. 128
(2) A money transmitter licensed as a money services 129
business pursuant to s. 560.141 is exempt from registration as a 130
virtual currency kiosk business but is subject to ss. 560.504, 131
560.505, and 560.506. 132
(3) If an entity, in t he course of its business, acts as 133
an intermediary with the ability to unilaterally execute or 134
indefinitely prevent a virtual currency kiosk transaction, or 135
otherwise meets the definition of a money transmitter as defined 136
in s. 560.103, the entity must be licensed pursuant to s. 137
560.141. 138
(4) Unless licensed as a money services business pursuant 139
to s. 560.141, a money transmitter that operates or solicits 140
business as a virtual currency kiosk business without first 141
being issued a certificate of registration by the office or 142
without maintaining a certificate of registration commits a 143
felony of the third degree, punishable as provided in s. 144
775.082, s. 775.083, or s. 775.084. 145
(5) A person who registers or attempts to register as a 146
virtual currency kiosk busi ness by means of fraud, 147
misrepresentation, or concealment commits a felony of the third 148
degree, punishable as provided in s. 775.082, s. 775.083, or s. 149
775.084. 150
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(6) A virtual currency kiosk business registration issued 151
under this part is not transferable or assignable. 152
Section 6. Section 560.503, Florida Statutes, is created 153
to read: 154
560.503 Registration applications. — 155
(1) To apply to be registered as a virtual currency kiosk 156
business under this part, the applicant must submit all of the 157
following to the office: 158
(a) A completed registration application on forms 159
prescribed by rule of the commission which must include the 160
following information: 161
1. The legal name, including any fictitious or trade names 162
used by the applicant in the conduct of its business, and the 163
physical and mailing address of the applicant. 164
2. The date of the applicant's formation and the state in 165
which the applicant was formed, if applicable. 166
3. The name, social security number, alien identification 167
or taxpayer identificati on number, business and residence 168
addresses, and employment history for the past 5 years for each 169
person who meets the definition of a control person. 170
4. A description of the organizational structure of the 171
applicant, including the identity of any parent or subsidiary of 172
the applicant, and the disclosure of whether any parent or 173
subsidiary is publicly traded. 174
5. The name of the registered agent in this state for 175
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service of process. 176
6. The physical address of the location of each virtual 177
currency kiosk through which the applicant proposes to conduct 178
or is conducting business in this state. 179
7. Any other information as required by this chapter or 180
commission rule. 181
(b) A nonrefundable fee in accordance with s. 182
560.143(1)(b). 183
(c) Any information needed to resolve any deficiencies 184
found in the application. This information must be submitted 185
within 30 days after the date of the application or the date of 186
any request by the office, whichever is later. 187
(2) A registrant shall report, on a form prescribed b y 188
rule of the commission, any change in the information contained 189
in an initial application form, or an amendment thereto, within 190
30 days after the change is effective. 191
(3) A registrant must renew its registration annually on 192
or before December 31 of the year of expiration. A registrant 193
may not receive a prorated fee for registration. To renew such 194
registration, the registrant must provide all of the following: 195
(a) The information required in paragraph (1)(a) if there 196
are changes in the application info rmation, or an affidavit 197
signed by the registrant that the information remains the same 198
as the prior year. 199
(b) Upon request, evidence that the registrant has been 200
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operating in compliance with ss. 560.504 and 560.505. Such 201
evidence may be prescribed by ru le by the commission and may 202
include, but is not limited to, all of the following: 203
1. Current disclosures presented to customers during the 204
transaction process. 205
2. Current use of blockchain analytics to prevent 206
transfers to wallet addresses linked to known criminal activity. 207
(4) The registration of a virtual currency kiosk business 208
that does not renew its registration by December 31 of the year 209
of expiration must be made inactive for 60 days. A virtual 210
currency kiosk business may not conduct business while its 211
registration is inactive. 212
(5) Within 60 days after the registration becoming 213
inactive pursuant to subsection (4), a virtual currency kiosk 214
business must renew its registration by submitting all of the 215
following: 216
(a) The information required in paragraph (1)(a) if there 217
are changes in the application information, or an affidavit 218
signed by the registrant that the information remains the same 219
as the prior year. 220
(b) Evidence that the registrant was operating in 221
compliance with ss. 560.504 and 5 60.505. Such evidence may be 222
prescribed by rule by the commission and may include, but is not 223
limited to, all of the following: 224
1. Current disclosures presented to customers during the 225
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transaction process. 226
2. Current use of blockchain analytics to prev ent 227
transfers to wallet addresses linked to known criminal activity. 228
229
Any renewal registration made pursuant to this subsection 230
becomes effective upon the date of any certificate of 231
registration that is issued by the office. 232
(6) Failure to submit an appl ication to renew the virtual 233
currency kiosk business's registration within 60 days after the 234
registration becoming inactive pursuant to subsection (5) shall 235
result in the registration becoming null and void. If the 236
registration is null and void, a new appl ication to register the 237
virtual currency kiosk business must be submitted to the office 238
and a certification of registration must be issued by the office 239
before the virtual currency kiosk business may resume conducting 240
business in this state. 241
(7) If a control person of a registrant or prospective 242
registrant has engaged in any unlawful business practices, or 243
been convicted or found guilty of a crime involving dishonest 244
dealing, fraud, acts of moral turpitude, or other acts that 245
reflect an inability to engag e lawfully in the business of a 246
registered virtual currency kiosk business, the office may not 247
accept the prospective registrant's initial registration 248
application or the registrant's renewal application. 249
(8) A virtual currency kiosk business's renewal 250
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application that fails to provide evidence of compliance, if 251
requested in paragraph (3)(b) or as required in paragraph 252
(5)(b), must be denied by the office. 253
(9) Any false statement made by a virtual currency kiosk 254
business with respect to the name of the business or its 255
business address or location in any application for registration 256
under this section renders the registration void. A void 257
registration may not be construed as creating a defense to any 258
prosecution for violation of this chapter. 259
(10) The commission may adopt rules to administer this 260
section. 261
Section 7. Section 560.504, Florida Statutes, is created 262
to read: 263
560.504 Disclosures. — 264
(1) Disclosures or attestations required by this section 265
and displayed by a virtual currency kiosk must me et all of the 266
following requirements: 267
(a) Be full and complete. 268
(b) Contain no material misrepresentations. 269
(c) Be readily understandable and in the language in which 270
the virtual currency kiosk transaction is conducted. 271
(d) Be displayed in at least 14-point type. 272
(2) Before authorizing a customer to initiate a virtual 273
currency kiosk transaction, the virtual currency kiosk business 274
shall ensure that the virtual currency kiosk displays the 275
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disclosures in this section on two separate screens: 276
(a) The first disclosure must be in substantially the 277
following form: 278
279
WARNING: CONSUMER FRAUD OFTEN STARTS WITH CONTACT FROM 280
A STRANGER WHO IS INITIATING A DISHONEST SCHEME. I 281
UNDERSTAND THAT DISHONEST SCHEMES MAY APPEAR IN MANY 282
FORMS, INCLUDING, BUT NOT LIMIT ED TO: 283
284
1. Claims of a frozen bank account or credit card. 285
2. Fraudulent bank transactions. 286
3. Claims of identity theft or job offerings in 287
exchange for payments. 288
4. Requests for payments to government agencies or 289
companies. 290
5. Requests for disaster relief donations or loans. 291
6. Offers to purchase tickets for lotteries, 292
sweepstakes, or drawings for vehicles. 293
7. Prompts to click on desktop pop -ups, such as virus 294
warnings or communication from alleged familiar 295
merchants. 296
8. Communication from someone impersonating a 297
representative of your bank or a law enforcement 298
officer. 299
9. Requests from persons who are impersonating 300
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relatives or friends in need or promoting investment 301
or romance scams. 302
303
PROTECT YOURSELF FROM FRAUD. NEVER SEND MONEY TO 304
SOMEONE YOU DON'T KNOW. 305
306
(b) The second disclosure must be in substantially the 307
following form: 308
309
WARNING: FUNDS LOST DUE TO USER ERROR OR FRAUD MAY NOT 310
BE RECOVERABLE. TRANSACTIONS CONDUCTED ON THIS VIRTUAL 311
CURRENCY KIOSK ARE IRREVERSIBLE. I UNDERSTAND THESE 312
RISKS AND WISH TO CONTINUE WITH CONDUCTING MY VIRTUAL 313
CURRENCY KIOSK TRANSACTION. 314
315
PROTECT YOURSELF FROM FRAUD. NEVER SEND MONEY TO 316
SOMEONE YOU DON'T KNOW. 317
318
(3)(a) After the disclosures provided in subsection (2) 319
are acknowledged by the customer, the virtual cu rrency kiosk 320
business must ensure that the virtual currency kiosk displays on 321
a pop-up window the following question to the customer: "ARE YOU 322
USING THIS KIOSK TO SEND VIRTUAL CURRENCY TO A WALLET OWNED BY 323
SOMEONE ELSE?" 324
(b) The virtual currency kiosk bu siness must require the 325
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customer to respond to the question in paragraph (a) with a "no" 326
response before the customer can proceed to the attestation 327
required in subsection (4). 328
(c) The virtual currency kiosk business must ensure that 329
the virtual currency kiosk terminates a customer's virtual 330
currency kiosk transaction if the customer has provided a "yes" 331
response to the question in paragraph (a). 332
(4) After the disclosure provided in subsection (2) and 333
the negative answer to the question provided in para graph 334
(3)(a), the virtual currency kiosk business must ensure that the 335
virtual kiosk displays, on a screen by itself, the following 336
attestation: "I ATTEST THAT I AM YOUNGER THAN 60 YEARS OF AGE." 337
(a) If a customer attests that he or she is younger than 338
60 years of age, the virtual currency kiosk may allow the 339
customer to proceed with the virtual currency kiosk transaction. 340
(b) If a customer attests that he or she is 60 years of 341
age or older, the virtual currency kiosk business must ensure 342
that the virtual currency kiosk provides such customer with a 343
toll-free number to contact regarding the risks of engaging in 344
virtual currency transactions. The toll -free number must be 345
displayed on the virtual currency kiosk display after the 346
customer attests that he or she is 60 years of age or older. 347
(c) After displaying the toll -free number required under 348
paragraph (b), the virtual kiosk business must ensure that the 349
virtual currency kiosk displays, on a screen by itself, the 350
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following attestation in substantially t he following form: 351
352
I ATTEST THAT I AM 60 YEARS OF AGE OR OLDER. I ALSO 353
ATTEST THAT I HAVE BEEN GIVEN A TOLL -FREE NUMBER AND 354
THAT I HAVE HAD AN OPPORTUNITY TO CALL SUCH NUMBER TO 355
SPEAK WITH SOMEONE REGARDING THE RISKS OF ENGAGING IN 356
VIRTUAL CURRENCY KIOSK TRANSACTIONS. I FURTHER ATTEST 357
THAT I UNDERSTAND THAT I MAY BE SOLELY RESPONSIBLE FOR 358
LOSS OF FUNDS DUE TO USER ERROR OR FRAUD. 359
360
(d) If a customer makes the attestation in paragraph (c), 361
the virtual currency kiosk may allow the customer to proceed 362
with the virtual currency kiosk transaction. 363
(e) If the customer does not make the attestation in 364
paragraph (c), the virtual currency kiosk business must ensure 365
that the virtual currency kiosk terminates the customer's 366
virtual currency kiosk transaction. 367
(5) The commission may adopt rules to administer this 368
section and to ensure that virtual currency kiosk disclosures 369
are responsive to consumer fraud and emerging technology. 370
Section 8. Section 560.505, Florida Statutes, is created 371
to read: 372
560.505 Conduct of business.—A virtual currency kiosk 373
business may transact business under this part only under the 374
legal name by which such business is registered. The use of a 375
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fictitious name is allowed if the fictitious name has been 376
registered with the Department o f State and disclosed to the 377
office as part of an initial registration or license 378
application, or subsequent amendment to the application, before 379
its use. 380
Section 9. Section 560.506, Florida Statutes, is created 381
to read: 382
560.506 Enhanced due diligenc e.— 383
(1)(a) A virtual currency kiosk business must hold a new 384
customer's assets in an initial transaction in a segregated 385
wallet for 48 hours before initiating the transaction. 386
(b) A virtual currency kiosk business may not accept or 387
dispense more than $1,000 from or to a customer in an initial 388
transaction. 389
(2) A customer may request a refund within the 48 -hour 390
holding period provided in paragraph (1)(a), and the assets may 391
be sold at market value and returned to the customer by the 392
virtual currency kiosk business in the same method by which the 393
customer completed his or her initial purchase, notwithstanding 394
any fees. 395
(3) A customer who is 60 years of age or older must be 396
queried for the following information on a single transaction 397
that is exceeds $3,000: 398
(a) The source of the fund. 399
(b) The purpose of the transaction. 400
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(c) The customer's occupation. 401
(4) The information required in paragraph (3)(a) shall be 402
queried of a customer if the customer is: 403
(a) Sixty years of age or older and has reach ed an 404
aggregate number of transactions totaling $25,000 or more; or 405
(b) Fifty-nine years of age or younger and has reached an 406
aggregate number of transactions totaling $50,000 or more. 407
Section 10. Section 560.507, Florida Statutes, is created 408
to read: 409
560.507 Penalties.— 410
(1) A virtual currency kiosk business that violates s. 411
560.504 commits a felony of the third degree, punishable as 412
provided in s. 775.082, s. 775.083, or s. 775.084. 413
(2) Each of the following violations constitutes a 414
misdemeanor of the second degree, punishable as provided in s. 415
775.082 or s. 775.083: 416
(a) Operating under any name other than that designated in 417
the registration, unless written notification is given to the 418
office. 419
(b) Assigning or attempting to assign a virtual currency 420
kiosk business registration issued under this part. 421
(3) In addition to the criminal penalties provided for 422
under this section, a court may invalidate the registration of 423
any registrant under this part who has been found guilty of 424
conduct prohibited in subsection (1) or subsection (2). 425
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Section 11. This act shall take effect January 1, 2025. 426