§ 2574. Required disclosures
(a) Licensee disclosures, generally. A person licensed under subchapter 2 of this chapter to engage in virtual-currency
business activity shall provide the disclosures required by this section and any additional
disclosure the Commissioner determines reasonably necessary for the protection of
the public.
(1) A disclosure required by this section must be made separately from any other information
provided by the licensee and in a clear and conspicuous manner in a record the person
may keep.
(2) The Commissioner may waive one or more requirements in subsections (b)–(d) of this
section and approve alternative disclosures proposed by a licensee if the Commissioner
determines that the alternative disclosure is more appropriate for the virtual-currency
business activity and provides the same or equivalent information and protection to
the public.
(b) Licensee disclosures prior to business activity. Before engaging in virtual-currency business activity with a person, a licensee shall
disclose, to the extent applicable to the virtual-currency business activity the licensee
will undertake with the person:
(1) a schedule of fees and charges the licensee may assess, the manner by which fees and
charges will be calculated if they are not set in advance and disclosed, and the timing
of the fees and charges, including general disclosure regarding mark-ups and mark-downs
on purchases, sales, or exchanges of virtual currency in which the licensee or any
affiliate thereof is acting in a principal capacity;
(2) whether the product or service provided by the licensee is covered by:
(A) a form of insurance or is otherwise guaranteed against loss by an agency of the United
States:
(i) up to the full U.S. dollar equivalent of virtual currency purchased from the licensee
or for control of virtual currency by the licensee as of the date of the placement
or purchase, including the maximum amount provided by insurance under the Federal
Deposit Insurance Corporation or otherwise available from the Securities Investor
Protection Corporation; or
(ii) if not provided at the full U.S. dollar equivalent of virtual currency purchased from
the licensee or for control of virtual currency by the licensee, the maximum amount
of coverage for each person expressed in the U.S. dollar equivalent of the virtual
currency; or
(B) private insurance against theft or loss, including cyber theft or theft by other means;
(3) the irrevocability of a transfer or exchange and any exception to irrevocability;
(4) a description of:
(A) liability for an unauthorized, mistaken, or accidental transfer or exchange;
(B) the person’s responsibility to provide notice to the licensee of the transfer or exchange;
(C) the basis for any recovery by the person from the licensee;
(D) general error-resolution rights applicable to the transfer or exchange; and
(E) the method for the person to update the person’s contact information with the licensee;
(5) that the date or time when the transfer or exchange is made and the person’s account
is debited may differ from the date or time when the person initiates the instruction
to make the transfer or exchange;
(6) whether the person has a right to stop a preauthorized payment or revoke authorization
for a transfer and the procedure to initiate a stop-payment order or revoke authorization
for a subsequent transfer;
(7) the person’s right to receive a receipt, trade ticket, or other evidence of the transfer
or exchange;
(8) the person’s right to at least 30 days’ prior notice of a change in the licensee’s
fee schedule, other terms and conditions of operating its virtual-currency business
activity with the person, and the policies applicable to the person’s account; and
(9) that virtual currency is not money.
(c) Disclosures.
(1) Disclosures prior to each virtual-currency transaction. In connection with any virtual-currency transaction effected through a virtual-currency
kiosk in this State, or in any transaction where the licensee or any affiliate thereof
is acting in a principal capacity in a sale of virtual currency to, or purchase of
virtual currency from, a customer, then immediately prior to effecting such a purchase
or sale transaction with or on behalf of a customer, a licensee shall prominently
disclose and shall require the customer to acknowledge and confirm the terms and conditions
of the virtual-currency transaction, which shall include the following:
(A) the type, value, date, precise time, and amount of the transaction;
(B) the consideration charged for the transaction, including:
(i) any charge, fee, commission, or other consideration for any trade, exchange, conversion,
or transfer involving virtual currency; and
(ii) any difference between the price paid by the customer for any virtual currency and
the prevailing market price of such virtual currency, if any;
(C) for a customer of a virtual-currency kiosk, a description of the virtual-currency
kiosk operator’s refund policy, which shall be consistent with the requirements specified
in subsections 2577(k) and (l) of this subchapter;
(D) for a customer of a virtual-currency kiosk, the customer warning described in subdivision
(g)(1) of this section; and
(E) the daily transaction limit, if applicable.
(2) Disclosures for new kiosk accounts. When opening an account for a new customer, and prior to entering into an initial
transaction for, on behalf of, or with such customer, each virtual-currency kiosk
operator shall disclose relevant terms and conditions associated with its products,
services, and activities and with virtual currency, generally, including disclosures
substantially similar to the following:
(A) the customer’s liability for unauthorized virtual-currency transactions;
(B) under what circumstances the virtual-currency kiosk operator will, absent a court
or government order, disclose information concerning the customer’s account to third
parties;
(C) the customer’s right to receive periodic account statements and valuations from the
virtual-currency kiosk operator;
(D) the customer’s right to receive a receipt, trade ticket, or other evidence of a transaction;
(E) the customer’s right to prior notice of a change in the virtual-currency kiosk operator’s
rules or policies;
(F) a statement of the material risks associated with virtual-currency transactions, generally,
as described in subsection (h) of this section;
(G) the name and telephone number of the Department of Financial Regulation and a statement
disclosing that a customer may contact the Department with questions or complaints
about a licensee; and
(H) such other disclosures as are customarily given in connection with the opening of
customer accounts.
(d) Licensee receipt requirements. Except as otherwise provided in subsection (e) of this section, at the conclusion
of a virtual-currency transaction with or on behalf of a person, a licensee shall
provide the person with a receipt that contains:
(1) the name and contact information of the licensee, including information the person
may need to ask a question or file a complaint;
(2) the type, value, date, precise time, and amount of the transaction expressed in U.S.
currency;
(3) the consideration charged for the transaction, including:
(A) any charge, fee, commission, or other consideration for any trade, exchange, conversion,
or transfer involving virtual currency; or
(B) the amount of any difference between the price paid by the customer for any virtual
currency and the prevailing market price of such virtual currency, if any; and
(4) any other information required pursuant to section 2562 of this title.
(e) Licensee daily confirmation. If a licensee discloses that it will provide a daily confirmation in the initial
disclosure under subsection (b) of this section, the licensee may elect to provide
a single, daily confirmation for all transactions with or on behalf of a person on
that day instead of a per-transaction confirmation.
(f) Kiosk transaction receipt. Notwithstanding any other provision of law to the contrary, a virtual-currency kiosk
operator shall provide a customer with both a paper and an electronic receipt in a
retainable form for each virtual-currency transaction completed at a virtual-currency
kiosk. In addition to the information required to be included in a receipt under subsection
(d) of this section or under section 2562 of this title, each receipt for a virtual-currency transaction completed at a virtual-currency
kiosk shall include:
(1) the identification of any applicable digital wallet address to which virtual currency
is transmitted;
(2) the full name of the account owner;
(3) any unique transaction identifiers;
(4) a prominent statement of the virtual-currency kiosk operator’s refund obligations
under this section, in a form approved by the Commissioner;
(5) a statement of the operator’s liability for nondelivery or delayed delivery of virtual
currency; and
(6) the name and telephone number of the Department of Financial Regulation and a statement
disclosing that a customer may contact the Department with questions or complaints
about an operator.
(g) Customer warning.
(1) Prior to entering into a virtual-currency transaction with a customer at a virtual-currency
kiosk, and as required by subdivision (c)(1)(D) of this section, each virtual-currency
kiosk operator shall ensure a warning is disclosed to the customer substantially similar
to the following:
| Customer Notice. Please Read Carefully. |
Did you receive a phone call from your bank, software provider, the police, or were you directed to make a payment for Social Security, a utility bill, an investment, warrants, or bail money at this kiosk? STOP
Is anyone on the phone pressuring you to make a payment of any kind? STOP
I understand that the purchase and sale of cryptocurrency may be a final, irreversible, and nonrefundable transaction.
I confirm I am sending funds to a digital wallet I own or directly have control over. I confirm that I am using funds gained from my own initiative to make my transaction.
(2) A virtual-currency kiosk operator shall ensure a customer has a readily accessible
opportunity to end a transaction for any reason prior to its completion.
(h) Statement of material risks. As used in subdivision (c)(2)(F) of this section, a statement of material risks associated
with virtual-currency transactions, generally, shall include disclosures substantially
similar to the following:
(1) Virtual currency is not legal tender, is not backed by the government, and accounts
and value balances are not subject to Federal Deposit Insurance Corporation or Securities
Investor Protection Corporation protections.
(2) Legislative and regulatory changes or actions at the State, federal, or international
level may adversely affect the use, transfer, exchange, and value of virtual currency.
(3) Transactions in virtual currency may be irreversible and, accordingly, losses due
to fraudulent or accidental transactions may not be recoverable.
(4) Some virtual-currency transactions shall be deemed to be made when recorded on a public
ledger, which is not necessarily the date or time that the customer initiates the
transaction.
(5) The value of virtual currency may be derived from the continued willingness of market
participants to exchange fiat currency for virtual currency, which may result in the
potential for permanent and total loss of value of a particular virtual currency should
the market for that virtual currency disappear.
(6) There is no assurance that a person who accepts a virtual currency as payment today
will continue to do so in the future.
(7) The volatility and unpredictability of the price of virtual currency relative to fiat
currency may result in significant loss over a short period of time.
(8) The nature of virtual currency may lead to an increased risk of fraud or cyber attack.
(9) The nature of virtual currency means that any technological difficulties experienced
by the virtual-currency kiosk operator may prevent the access or use of a customer’s
virtual currency.
(10) Any bond or trust account maintained by the virtual-currency kiosk operator for the
benefit of its customers may not be sufficient to cover all losses incurred by customers. (Added 2023, No. 110 (Adj. Sess.), § 48, eff. July 1, 2024; amended 2025, No. 23, § 23, eff. July 1, 2025.)