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Tennessee, USA
US-TNschema crypto-v2.0.0trajectory: not yet assessedin transitionoverlaps: FIM, Advennt
Last updated · 8 categories · 14 sourced
findings · 15 sources in the cumulative register
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Jurisdiction lead brief
Lead Signal
Tennessee has enacted and successfully defended a statewide prohibition on virtual-currency kiosks. Public Chapter 766 requires decommissioning of every kiosk in the state by July 1, 2026, with no exception for existing machines and none for kiosks operated by licensed financial institutions; operating a kiosk after that date is a Class A misdemeanor. The Tennessee Attorney General publicly justified the measure on the basis that cryptocurrency ATMs are used as tools by scammers targeting vulnerable Tennesseans, and the state defeated an industry-led motion for a federal temporary restraining order that sought to delay the ban's effective date, allowing the prohibition to take effect on schedule. This is a product-level prohibition, not a licensing-regime change: Tennessee's Department of Financial Institutions has a long-standing, unchanged policy position that virtual currency sits outside the scope of the state Money Transmitter Act and that the Money Transmitter License and its surety bond do not cover virtual-currency transmission. The kiosk ban and that structural licensing exemption sit alongside each other rather than in tension: the state has removed a specific physical distribution channel while leaving its broader non-regulation of virtual currency transmission intact. For product-development and market-access planning, the practical effect of Public Chapter 766 is to foreclose the physical kiosk distribution model for virtual-currency access in Tennessee entirely, without altering whether an operator needs a state money-transmitter license to offer virtual-currency services through other channels, since TDFI's exemption position means no such state license currently governs virtual-currency transmission regardless of channel.
Other Developments
UCC controllable electronic records amendments. Tennessee incorporated the 2018 and 2022 Uniform Commercial Code amendments into Title 47 via Public Chapter 704, introducing the "controllable electronic records" concept and associated rules on control, effective July 1, 2026, with a transition adjustment date of July 1, 2027. This is a commercial-law development governing how rights in digital assets are perfected and transferred under state law; it is a property-law classification exercise rather than a securities or commodity determination, and it does not resolve how any specific token is treated for regulatory purposes.
Cross-Monitor Connections
The virtual-currency kiosk ban and its consumer-fraud framing overlap directly with the financial-integrity monitor's coverage of the same Public Chapter 766 development, which frames the ban as an AML-adjacent fraud-prevention measure pursued through consumer-protection rather than Bank Secrecy Act channels; readers should consult that monitor for the AML/CTF-specific reading of the state's structural non-regulation of virtual currency. The World Payments Monitor separately tracks the kiosk ban as a product-innovation and market-development event affecting the non-bank payment-instrument channel. This crypto-consumer record does not re-analyze either the AML or payments-corridor dimension of the ban; it records only the crypto-licensing and consumer-protection facts as found by this cycle's research. This overlap illustrates a recurring pattern for jurisdictions that address virtual-currency risk primarily through targeted product prohibitions rather than licensing expansion: a single underlying legislative act generates materially different, non-duplicative readings across the financial-integrity, payments, and crypto-regulatory monitors, each of which is accountable for a distinct slice of the same fact set.
Outlook
Two items merit tracking into the next cycle. First, the outcome of CoinFlip/GPD Holdings and Private IT Corp's litigation against Public Chapter 766 on the merits, which has so far cleared only an initial TRO denial; a merits ruling against the state could reopen the kiosk channel. Second, whether the Tennessee Department of Financial Institutions revisits its 2015 Virtual Currency Statement of Policy in light of the new kiosk ban remains unresolved, and any such revision would be a significant signal about whether the state intends to move toward a licensing-based approach to virtual-currency oversight rather than continuing to rely on targeted product prohibitions. Analysts tracking Tennessee's broader digital-asset posture should also note that the state's commercial-law treatment of digital assets, via the new UCC controllable-electronic-records framework, is a separate and independent track from its consumer-protection and product-prohibition activity; movement on one track should not be read as predictive of movement on the other.
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Tennessee has no bespoke crypto-asset licensing statute. Virtual-currency exchange and custody businesses fall under the state's general Money Transmitter licensing regime administered via NMLS, per the seed disambiguation. Separately, in April 2026 Tennessee enacted a targeted prohibition on virtual-currency kiosks (crypto ATMs) statewide, and its Sports Wagering Council has separately asserted that crypto-linked prediction-market platforms are engaging in unlicensed gambling. This mix of a general licensing backstop, a hard-ban carve-out for kiosks, and contested enforcement against event-contract platforms produces a fragmented, actively-shifting licensing posture.
Standing sub-brief153 words · last cycle 2026-09-21
Crypto Licensing
Tennessee enacted Public Chapter 766, requiring the decommissioning of all virtual-currency kiosks statewide by July 1, 2026, with no exception for existing machines or licensed financial institutions; operating a kiosk after that date is a Class A misdemeanor. This is a product-level prohibition rather than a change to the state's licensing perimeter. Separately, and unchanged this cycle, the Tennessee Department of Financial Institutions' Virtual Currency Statement of Policy confirms that the Money Transmitter License and its required surety bond do not cover virtual-currency transmission, and that TDFI does not regulate virtual currency generally. No comprehensive crypto exchange or custody licensing regime exists in Tennessee; the kiosk ban is a targeted hardware-channel prohibition layered on top of that structural absence.
Outlook
Watch for whether TDFI revisits its Virtual Currency Statement of Policy in light of Public Chapter 766, and for the merits outcome of the CoinFlip/GPD Holdings litigation challenging the kiosk ban.
Periodic update · new data 2026-09-22
Crypto Licensing
Tennessee's crypto licensing landscape tightened this cycle through a targeted prohibition rather than a comprehensive licensing overhaul. Public Chapter 766 bans virtual-currency kiosks statewide, making it a Class A misdemeanor to operate, install, permit, or host such a kiosk in Tennessee effective July 1, 2026. The statute carries no grandfathering provision for existing machines and no exemption for licensed financial institutions, meaning the prohibition is absolute for this specific channel regardless of the operator's existing regulatory standing. A federal court denied an industry temporary restraining order challenging the ban on July 7, 2026, allowing it to remain in force.
Outside this new prohibition, the state's underlying licensing architecture for crypto-adjacent businesses is unchanged. The Tennessee Department of Financial Institutions does not regulate virtual currency as such, and its published policy is explicit that the state money-transmitter license and its required surety bond do not extend to virtual-currency transmission. The operative boundary for licensing purposes remains the fiat-conversion leg: a business converting virtual currency to fiat currency for Tennessee customers falls within the state's money-transmission definition under the Tennessee Money Transmission Modernization Act and must hold a TDFI money-transmitter license. This boundary is directly sourced to TDFI's own published policy and independently corroborated by secondary legal-industry commentary describing the same fiat-conversion trigger.
The combined picture is one of narrow, channel-specific tightening layered on top of an otherwise unchanged and comparatively permissive licensing boundary for crypto-to-crypto activity, which continues to fall entirely outside Tennessee's state supervisory reach.
Outlook
Whether Tennessee will introduce any bespoke digital-asset licensing statute in a future legislative session remains an open question; the pattern to date favors narrow anti-fraud carve-outs, such as this cycle's kiosk ban, over comprehensive licensing reform. The precise current enforcement posture of the Tennessee Attorney General toward unregistered crypto exchanges operating with no fiat-conversion leg is not yet clear given TDFI's explicit disclaimer of jurisdiction over pure crypto-to-crypto activity.
1 further periodic run re-emitted the standing brief unchanged and is not shown.
Sources and findings (3)
T1 · Nationwide Multistate Licensing System / Tennessee Department of Financial InstitutionsNationwide Multistate Licensing System / Tennessee Department of Financial Institutions — Businesses engaged in virtual-currency exchange or custody activity in Tennessee are subject to the state's general money-transmitter licensing requirement administered via the NMLS, with no dedicated crypto-specific licence distinct from the general MTL regime confirmed.retrieved M4bindingin force
T4 · The BlockThe Block — Tennessee Governor Bill Lee signed House Bill 2505 on April 13, 2026, prohibiting the installation or operation of virtual-currency kiosks (crypto ATMs) statewide, extending liability to host businesses, with violations constituting a Class A misdemeanor.retrieved M5bindingin force
T4 · CoinDeskCoinDesk — The Tennessee Sports Wagering Council issued cease-and-desist orders in January 2026 to Kalshi, Polymarket, and Crypto.com, alleging that their crypto-linked sports event contracts constitute unlicensed gambling under state law, an action currently being challenged in federal court on federal preemption grounds.retrieved M4bindingin force
Tennessee has no state-level statutory taxonomy classifying crypto-assets as securities, e-money tokens, or utility tokens. Per the seed disambiguation, token characterisation for securities purposes is governed by federal SEC/CFTC jurisdiction, not a Tennessee-specific scheme. Tennessee's 2018 law recognizing blockchain data and smart contracts as legally valid records provides a narrow, adjacent form of legal recognition but does not constitute a token classification regime.
Standing sub-brief134 words · last cycle 2026-08-21
Token Classification
Tennessee incorporated the 2018 and 2022 Uniform Commercial Code amendments into Title 47 via Public Chapter 704, introducing the "controllable electronic records" concept and associated control rules, effective July 1, 2026, with a transition adjustment date of July 1, 2027. This is a commercial-law and property-law development governing how rights in digital assets are perfected and transferred as a matter of state commercial law; it is not a securities or commodity classification determination and does not itself resolve how any particular token is treated under Tennessee or federal law. No dedicated token-classification regime otherwise exists in the state.
Outlook
Watch for how the new controllable-electronic-records framework interacts in practice with federal securities and commodity classification questions once the July 1, 2026 effective date and July 1, 2027 transition adjustment date are reached.
No new data since the standing brief. 1 periodic run re-emitted it unchanged.
Sources and findings (2)
T1 · Nationwide Multistate Licensing System / Tennessee Department of Financial InstitutionsNationwide Multistate Licensing System / Tennessee Department of Financial Institutions — Tennessee has not enacted a state-specific statutory taxonomy for classifying crypto-assets (e.g., as securities, utility tokens, or stablecoins); such classification for securities purposes defaults to federal SEC/CFTC jurisdiction.retrieved M3non-binding
T4 · CoinDeskCoinDesk — Tennessee Governor Bill Haslam signed legislation in March 2018 legally recognizing blockchain data and smart contracts under state law, passing both legislative chambers unanimously.retrieved M2bindingin force
No Tennessee-specific statute or regulation governing staking, DeFi lending, DEX operation, mining, node operation, validator activity, or tokenization has been identified. The one Tennessee nexus in this space is procedural/venue-related: a federal tax dispute over Tezos staking-reward taxation (Jarrett v. United States) was litigated in the U.S. District Court for the Middle District of Tennessee, but this is a federal tax matter, not a Tennessee on-chain-activity regulation, and produced no binding precedent because the case was resolved via IRS refund rather than judicial ruling.
Absence reason not determinableNo sub-brief exists and the JID records no gap or review marker explaining why. The renderer will not invent a reason.
no periodic updates on record for this sub-brief
Sources and findings (2)
T1 · Nationwide Multistate Licensing System / Tennessee Department of Financial InstitutionsNationwide Multistate Licensing System / Tennessee Department of Financial Institutions — Tennessee has no state-specific statute or regulation addressing staking, DeFi lending, DEX operation, mining, node operation, validator activity, or tokenization; the jurisdiction has no analog to a bespoke on-chain-activity regime.retrieved M2non-bindinga fact about the regime
T4 · CoinDeskCoinDesk — A federal lawsuit over the taxation of Tezos proof-of-stake validator rewards (Jarrett v. United States) was filed and litigated in the U.S. District Court for the Middle District of Tennessee, but the case was resolved via an IRS refund rather than a judicial ruling, leaving no binding precedent on staking-reward taxation.retrieved M2non-binding
Tennessee has not enacted a state-specific stablecoin authorization, reserve, redemption, or systemic-designation regime. Stablecoin issuance and reserve requirements in this jurisdiction are governed exclusively by the federal GENIUS Act framework; Tennessee has no independent state-level overlay identified.
Absence reason not determinableNo sub-brief exists and the JID records no gap or review marker explaining why. The renderer will not invent a reason.
no periodic updates on record for this sub-brief
Sources and findings (1)
T1 · Nationwide Multistate Licensing System / Tennessee Department of Financial InstitutionsNationwide Multistate Licensing System / Tennessee Department of Financial Institutions — Tennessee has no state-specific stablecoin issuance-authorisation, reserve-requirement, redemption-right, or systemic-designation statute; stablecoin regulation in this jurisdiction is governed by the federal GENIUS Act rather than a Tennessee-specific regime.retrieved M3non-bindinga fact about the regime
Tennessee's principal crypto-specific consumer-protection intervention is the statewide ban on virtual-currency kiosks (HB 2505, effective July 1, 2026), enacted directly in response to elder-fraud and scam losses associated with crypto ATMs, which nationally totaled roughly $389 million in reported losses in 2025 according to FBI data cited in reporting. Beyond the kiosk ban, no broader Tennessee-specific statute mandating crypto risk disclosure, custody segregation, or complaint-handling for exchanges/custodians has been identified; such matters would default to general state consumer-protection and money-transmitter licensing law.
Standing sub-brief125 words · last cycle 2026-09-21
Consumer Protection
The Tennessee Attorney General publicly justified the statewide virtual-currency kiosk ban on the basis that cryptocurrency ATMs are used as tools by scammers targeting vulnerable Tennesseans, framing the measure as consumer-protection and fraud-prevention policy rather than AML or licensing reform. The Attorney General's office also defeated an industry motion for a temporary restraining order that sought to delay the ban's effective date, allowing the prohibition to take effect on schedule. This enforcement-driven, fraud-typology-focused rationale is currently the operative consumer-protection lever for virtual-currency risk in Tennessee, rather than any dedicated crypto-specific disclosure or custody-protection statute.
Outlook
Watch for the merits disposition of the industry challenge to Public Chapter 766, which will determine whether the Attorney General's consumer-protection rationale for the kiosk ban is sustained.
Periodic update · new data 2026-09-22
Consumer Protection
Tennessee's crypto-related consumer protection posture tightened this cycle around a single, targeted measure: the statewide ban on virtual-currency kiosks, framed explicitly by the Tennessee Attorney General as a consumer-protection measure against fraud targeting vulnerable residents. The Attorney General's office stated that a federal court had allowed the ban to take effect over industry objection, confirming both the measure's consumer-protection rationale and its survival of a legal challenge as of July 7, 2026.
This is an active, enforced consumer-protection intervention for the specific kiosk channel, but it does not reflect a general custody, disclosure, or consumer-safeguard rule applicable to crypto businesses broadly operating in Tennessee. No broader crypto-specific consumer-protection statute — covering matters such as custody standards, marketing disclosures, or complaint-handling requirements for crypto exchanges or wallet providers generally — was identified this cycle. The consumer-protection posture is therefore best characterized as reactive and channel-specific: it addresses a documented fraud vector directly rather than establishing a general regulatory floor for consumer protection across the crypto sector in the state.
Outlook
Whether Tennessee extends similar targeted consumer-protection measures to other crypto-adjacent channels identified as fraud vectors remains to be seen. Given the state's demonstrated willingness to act decisively against a specific channel once a fraud pattern is documented, a comparable response to any newly identified conduit would be consistent with this cycle's approach, though no such action has been identified as of this cycle.
1 further periodic run re-emitted the standing brief unchanged and is not shown.
Sources and findings (2)
T4 · The BlockThe Block — Tennessee's statewide prohibition on virtual-currency kiosks, enacted via HB 2505 and effective July 1, 2026, operates as a consumer-protection measure against fraud, following FBI data reporting nearly $390 million in crypto-kiosk-related losses nationally in 2025, with older Americans disproportionately affected.retrieved M5bindingin force
T1 · Nationwide Multistate Licensing System / Tennessee Department of Financial InstitutionsNationwide Multistate Licensing System / Tennessee Department of Financial Institutions — No Tennessee-specific statute mandating custody segregation, risk disclosure, or complaint-handling procedures for crypto exchanges or custodians beyond the kiosk ban and general MTL licensing framework has been identified.retrieved M2non-bindingour coverage gap, expected to resolve on a re-run
Tennessee is one of the U.S. states with no state personal income tax, meaning no state-level capital gains tax applies to individual crypto-asset gains; state tax exposure on crypto transactions is effectively nil, though federal capital-gains and income-tax rules (IRS treatment of crypto as property) apply uniformly regardless of state. A notable federal tax dispute over the taxability of proof-of-stake rewards was litigated in the Middle District of Tennessee (Jarrett v. United States) but was resolved via IRS refund without a precedential ruling, leaving the federal question of staking-reward timing unresolved.
Absence reason not determinableNo sub-brief exists and the JID records no gap or review marker explaining why. The renderer will not invent a reason.
no periodic updates on record for this sub-brief
Sources and findings (2)
T4 · CoinDeskCoinDesk — Tennessee is one of nine U.S. states with no state income tax, meaning individual crypto-asset capital gains are not subject to any Tennessee state-level income or capital-gains tax; only federal capital-gains tax applies.retrieved M4bindingin force
T4 · CoinDeskCoinDesk — Federal IRS guidance treats crypto-assets as property for tax purposes, with staking rewards generally treated as ordinary income upon receipt; this federal position was tested but not overturned in a Tennessee-venued lawsuit (Jarrett v. United States) that was resolved via IRS refund without setting binding precedent.retrieved M3bindingin force
No Tennessee-specific statute restricting outbound crypto-asset transfers, imposing state-level cross-border reporting thresholds, or extending the travel rule beyond federal requirements has been identified. Federal OFAC sanctions-screening and FinCEN's funds/travel-rule obligations apply uniformly to Tennessee-domiciled money transmitters engaged in convertible-virtual-currency transactions, without a distinct state overlay.
Absence reason not determinableNo sub-brief exists and the JID records no gap or review marker explaining why. The renderer will not invent a reason.
no periodic updates on record for this sub-brief
Sources and findings (1)
T1 · FinCEN / U.S. Department of the TreasuryFinCEN / U.S. Department of the Treasury — Tennessee imposes no state-specific outbound restriction, cross-border reporting threshold, or travel-rule requirement on crypto-asset transfers beyond the federal baseline; any non-exempt Tennessee money transmitter engaged in convertible virtual currency transactions must register with FinCEN within 180 days of commencing such activity and comply with the federal Funds Travel Rule.retrieved M3bindingin force
Crypto AML/CFT obligations for this jurisdiction are handled under the fleet's shared Financial Integrity Module (FIM) subscription for aml_ctf; per the module-subscription reminder, no aml_cft_regime claims are produced in this baseline. Disambiguation context only: federal FinCEN money-transmitter/MSB obligations (registration, recordkeeping, SAR/CTR reporting, travel rule) apply uniformly to Tennessee-based virtual-currency businesses absent any state-specific AML overlay.
Absence reason not determinableNo sub-brief exists and the JID records no gap or review marker explaining why. The renderer will not invent a reason.
no periodic updates on record for this sub-brief
Sources and findings (1)
T1 · FinCEN / U.S. Department of the TreasuryFinCEN / U.S. Department of the Treasury — AML/CFT obligations for crypto in this jurisdiction are governed by the fleet's shared Financial Integrity Module (FIM) subscription; this baseline does not produce aml_cft_regime claims per the module-subscription reminder.retrieved M1non-bindinga fact about the regime
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