Status: Expired. Texas Senate Bill 1705, titled “relating to the regulation of virtual currency kiosks; providing an administrative penalty,” was a 2025 Texas proposal to create a dedicated state framework for crypto ATM-style terminals. The measure would have added Chapter 161 to Subtitle E, Title 3 of the Texas Finance Code. It did not become operative law. Texas Legislature Online lists the bill’s last action as placement on the House General State Calendar on May 27, 2025, and the 89th Regular Session ended June 2, 2025 without final enactment.
Texas virtual currency kiosk regulation overview
SB 1705 targeted “virtual currency kiosks,” defined in the House Committee Report text as electronic terminals used to facilitate exchange of virtual currency for money, bank credit, or other virtual currency. The proposal covered operators that engage in virtual currency business activity through a kiosk located in Texas or own, operate, or manage a kiosk through which that activity is offered.
The bill’s policy focus was consumer protection, fraud prevention, and regulatory visibility. Its official bill analysis cited law-enforcement concerns that cryptocurrency ATMs can be used in fraud schemes, money laundering, and other illicit activity, while presenting the bill as a response involving registration, reporting, disclosures, fraud controls, transaction limits, and fee limits.
Key provisions in SB 1705
Registration and reporting
The House Committee Report version would have required a virtual currency kiosk operator to register each kiosk with the Texas Department of Banking and obtain prior department approval before activation. Operators also would have had to file quarterly reports with kiosk location details, operating dates, trade names, and virtual currency addresses associated with each kiosk.
Disclosures, receipts, and customer acknowledgments
The proposal would have required clear material-risk disclosures before transactions, including warnings that virtual currency is not legal tender, may not be government-backed or insured, and can fluctuate significantly in value. It also would have required transaction-specific disclosures, customer acknowledgment before completion, and physical or digital receipts in the customer’s preferred language.
Fraud controls and transaction limits
SB 1705 would have required blockchain analytics software to help prevent transfers to wallets known to be associated with fraudulent activity. It also would have required a written antifraud policy, a full-time compliance officer, customer ID scanning, registered recipient wallets, and a 72-hour hold for first-time customers. The House Committee Report version would have capped customer transactions at $3,000 in a 24-hour period and limited aggregate fees to the greater of $5 or 12% of the U.S. dollar equivalent involved.
Enforcement structure and regulator role
The proposed framework assigned key duties to the Texas Department of Banking and the banking commissioner, while giving the Finance Commission of Texas rulemaking authority. Enforcement tools would have included registration revocation, cease-and-desist orders, consent orders, emergency orders, administrative penalties of up to $5,000 per violation or per day for continuing violations, and judicial review in Travis County district court for final orders after hearing.
Status and legislative timeline
SB 1705 was filed on Feb. 27, 2025, referred to the Senate Business & Commerce Committee on March 13, reported from committee on May 12, and passed the Senate on May 15. In the House, it was referred to Pensions, Investments & Financial Services, reported favorably on May 22, and placed on the General State Calendar on May 27. Because the bill did not complete final House passage and enactment before the regular session ended, this profile treats it as expired rather than effective Texas regulation.
Related Texas digital asset proposals
Editors should distinguish SB 1705 from HB 2798, a separate House bill on disclosures and requirements for virtual currency kiosk transactions, and from HB 4233, where a Senate floor amendment also proposed virtual-currency-kiosk provisions. This profile focuses on SB 1705 because its caption directly addressed the regulation of virtual currency kiosks and it advanced through both chambers’ committee process.