Manhattan DA Urges New York to Criminalize Unlicensed Crypto Operations

Highlights:

• Alvin Bragg has noted that unlicensed crypto operations let criminals move billions with little oversight.
• High-fee crypto ATMs help criminals avoid banks and weaken money laundering enforcement.
• Pig-butchering scams have exposed the limits in tracing and recovering stolen crypto funds.

Manhattan District Attorney Alvin Bragg urged New York lawmakers on Wednesday to strengthen crypto laws and close enforcement gaps. Speaking at New York Law School, he warned that weak oversight allows a $51 billion criminal economy to operate freely.

🚨 BIG NEWS: Manhattan DA Alvin Bragg is pushing for tighter crypto regulations in New York! 💼

💡 Key points:

📌 Making unlicensed crypto operations a FELONY to combat a $51B illicit economy.
📌 Targeting unlicensed crypto ATMs charging up to 20% fees for cash-to-digital…

— SunLumi (@Girl_SunLumi) January 15, 2026

According to Bragg, criminals exploit regulatory blind spots to launder proceeds tied to guns, drugs, fraud, and terrorism financing. He said crypto enforcement now stands alongside guns and shoplifting as a top second-term priority. As a result, he pressed lawmakers to act quickly and remove legal loopholes limiting prosecutions.

Bragg said current statutes fail to provide consistent accountability across the crypto sector. He explained that prosecutors often lack clear authority when businesses operate without proper licenses. Because of this, investigators struggle even when evidence of laundering appears obvious. He urged lawmakers and the public to treat the issue with urgency rather than delay. Moreover, he said unchecked crypto crime threatens public safety across New York communities.

Bragg proposed mandatory licensing for all crypto businesses operating in the state. He said firms that trade, transfer, or move digital assets must follow clear regulatory rules. Additionally, he called for criminal penalties to support licensing and compliance standards. He argued that enforcement should never depend on criminals making mistakes. If adopted, the proposal would make New York the nineteenth state to criminalize unlicensed activity.

Unlicensed Crypto Operations Face Scrutiny Over High-Fee ATMs

Bragg focused heavily on crypto kiosks and ATMs operating without licenses across New York. He said these machines often charge fees reaching 20% to convert cash into crypto. According to Bragg, operators frequently ask a few questions about where funds come from. As a result, criminals use the machines to move illegal cash quickly. He said many operators knowingly ignore warning signs tied to gun and fraud proceeds.

Bragg explained that unlicensed kiosks allow criminals to bypass traditional banks entirely. As a result, investigators lose transaction trails that often expose illegal activity. He warned that enforcement should not rely on criminals slipping up. He said many offenders operate carefully and avoid obvious errors. Therefore, stronger laws must remove these easy laundering routes.

Pig-Butchering Scams Expose Gaps in Crypto Recovery

During a public question session, concerns surfaced about victims of pig-butchering crypto scams. Civil litigator Margo Hoppen described cases involving widowed and elderly New Yorkers losing life savings. Bragg acknowledged that recovering stolen crypto remains extremely difficult. He said prosecutors spend a lot of time attempting to trace lost digital assets. However, current laws often limit the recovery success.

Bragg pointed to legislation from Zellnor Myrie as a possible solution to recovery challenges. He said the RIPOFF Act could give authorities stronger tools to help victims. Meanwhile, federal enforcement efforts continue beyond New York. This week, prosecutors in Massachusetts sought forfeiture of $200,000 in USDT. The funds stemmed from a romance-based scam using online dating platforms.

United States Attorney’s Office Files Civil Forfeiture Action to Recover Proceeds of Cryptocurrency Investment Fraud Scheme https://t.co/60kGVuRXZw

— Law Office of Justin R. McCarthy (@jrmccarthy_law) January 12, 2026