California Court Upholds $1,000 Limit on Daily Crypto ATM Withdrawals, Citing Fraud Prevention Measures
A court in Los Angeles County has ruled in favor of upholding the Digital Financial Assets Law in California, which includes a $1,000 daily withdrawal limit for cryptocurrency ATMs. The law, which also requires crypto ATM operators to obtain licenses and adhere to fee limits and new disclosure requirements, aims to enhance consumer protection and prevent fraudulent transactions.
The ruling comes after the Alliance for the Fair Access to Cryptocurrency Terminals filed a lawsuit challenging the withdrawal limit, arguing that it exceeded the authority of the Legislature. The court, however, deemed the limit reasonable and an effective measure to combat fraud.
DFPI Commissioner Clothilde Hewlett emphasized the importance of these regulations in safeguarding consumers and preventing illicit activities. Hewlett stated that the law’s provisions, including the daily withdrawal limit, are meant to protect Californians and foster responsible innovation in the state’s crypto industry.
In addition to the withdrawal limit, the Digital Financial Assets Law also includes provisions to limit fees charged by crypto ATM operators and mandate new disclosure requirements. Operators in California will be required to apply for a DFAL license to comply with these regulations.
Signed into law in October 2023, the DFAL sets a regulatory framework that will gradually come into effect starting July 2025. It aims to establish comprehensive guidelines and oversight for digital financial asset businesses in the state.
The court’s decision to uphold the withdrawal limit has generated varied opinions. Please share your thoughts on this development in the comments section below.