Attorney General of Iowa Sues Crypto ATM Firms
Iowa Attorney General Brenna Bird has initiated lawsuits against two crypto ATM companies, Bitcoin Depot and Coinflip. Some insiders and outsiders within the White House suggest that this move conflicts with President Donald Trump’s aspiration for the U.S. to emerge as the “crypto capital of the world.”
Trump has previously highlighted the significance of establishing a solid foothold in the crypto industry, comparing his efforts to long-standing traditional sectors such as steel. He expressed a goal for the U.S. to become the “Bitcoin superpower” during the 2024 Bitcoin Conference in Nashville.
He notably promised to dismiss Gary Gensler, then chairman of the Securities and Exchange Commission. Support for Trump in the crypto sector has been evident, especially from the Winklevoss twins, co-founders of Gemini Exchange, who donated $2 million in Bitcoin to his campaign. They criticized President Biden’s approach toward the cryptocurrency sector.
In mid-2024, Jesse Powell, founder of Kraken, contributed $1 million in Ethereum to Trump’s campaign, voicing concerns about the Biden administration’s regulatory stance on cryptocurrencies. Powell articulated his viewpoint that, despite bipartisan congressional attempts to clarify regulations, the current administration seemed inclined toward enforcing ambiguous regulations.
By October 2024, Trump’s Community Fundraising Committee had reportedly gathered around $7.5 million in crypto donations, including Bitcoin and Ethereum. Remarkably, Trump has been the first sitting president to sign a deal in Bitcoin, which he found “very easy.” In September 2024, he visited a New York venue known for accepting crypto payments.
On his first day in office, Trump issued an executive order aimed at bolstering U.S. leadership in digital financial technologies, specifically to enhance American status in the digital asset sphere and safeguard economic freedoms. He subsequently worked with legislators to advance the Genius Act, a bill aimed at creating a clearer regulatory environment for the cryptocurrency market.
Despite Trump’s enthusiasm for crypto, Bird’s announcement regarding the lawsuits against Bitcoin Depot and Coinflip highlights her claim that these companies have contributed to losses exceeding $20 million for Iowa residents due to scams, positioning her as the only state attorney general taking action against crypto ATMs.
At a press conference where she detailed the lawsuits, Adam Greg, president of the Iowa Banks Association, was present. David Bossy, an influential figure in Trump’s campaigns, remarked that Bird’s collaboration with the Iowa Banks Association spoke volumes about her priorities.
Two Iowa Supreme Court rulings noted that Bitcoin Depot might not have adequate grounds to know about scams involving users of their ATMs. A recent judgment emphasized that mere suspicions or general knowledge of potential fraud were insufficient for holding the company accountable.
The lawsuits have raised concerns among various stakeholders, including those close to the White House. A senior official remarked on the contradiction between Trump’s desire for Iowans to have access to cryptocurrency and Bird’s legal actions against its providers.
Andrew Miltenberg, an experienced trial lawyer, expressed doubt regarding Bird’s lawsuits, suggesting they could relate more to political maneuvering than genuine consumer protection. He compared the lawsuit against a crypto ATM company to holding gun manufacturers accountable for shootings—a problematic oversimplification, in his view.
While he acknowledged the need for better regulations to protect consumers in the crypto space, he advocated that this approach by the attorney general was not the most effective means to achieve that end. He noted, “This seems more like a headline grab and a direct shot at the president.”
Brenna Bird did not offer any remarks to address this coverage at the time.
