Vermont Money Transmitter License

Vermont Money Transmitter License: The Complete Guide to Getting Licensed in 2026

Everything you need to know about applying for, obtaining, and maintaining a Vermont money transmitter license — costs, timeline, requirements, and compliance obligations. Written by practitioners who do this for a living.

Last Updated: July 2026 · Regulatory Authority: Vermont Department of Financial Regulation (DFR), Banking Division · Governing Law: 8 V.S.A. Chapter 79 (Money Services), §§ 2500–2577, as rewritten by Act 110 of 2024 (H.659), effective 1 July 2024

You’re Here Because You Need a Vermont Money Transmitter License

Whether you’re a fintech startup building cross-border payment infrastructure, a cryptocurrency exchange serving national markets, a remittance company entering the Northeast, or an established money services business scaling to all 50 states — you need a clear picture of what Vermont requires, what it costs, and how long it takes.

Vermont occupies a unique position in American money transmitter licensing. Despite having a population of roughly 650,000 residents, virtually every legitimate national money transmitter must obtain a Vermont license. This is because money transmitter companies operating in multiple states must be licensed in all states where they operate — and since 1 July 2024 Vermont’s framework has been a rewritten, modernized statute rather than the patchwork it replaced.

One thing to understand before anything else: Vermont overhauled this law in 2024. Act 110 (H.659) replaced Chapter 79 with a version built on the CSBS Money Transmission Modernization Act (MTMA) — and then bolted on a virtual currency subchapter that Vermont wrote its own way. Guides that still quote Vermont’s old bond ladder, old fees or “perpetual” license are describing a statute that no longer exists.

This page gives you the complete picture. No fluff. No generic overviews. Just the actual requirements, drawn from the statute, the NMLS process, and hands-on licensing experience.

If you want the full 1,390+ line deep-dive with section-by-section regulatory analysis, download our complete guide below.

Download the Complete Vermont MTL Guide

Vermont MTL at a Glance

Before you read another word, here’s the snapshot:

This table alone puts you ahead of most applicants entering this process. But Vermont’s competitive advantage lies in the details. Let’s get into them.

What It Actually Costs: The Real Numbers

Everyone asks, “What does it cost to get a Vermont money transmitter license?” The answer isn’t a single number. It’s a stack of costs, and most guides only mention the application fee. Here’s the complete financial picture:

One-Time Application Costs

Annual Ongoing Costs

Bottom line: A lean operator with a straightforward business model should budget $107,000–$120,000 to get through the door (including net worth capital). A mid-market fintech should budget $120,000–$155,000. A complex operation serving multiple customer segments or handling cryptocurrency should plan for $140,000–$190,000.

These are real numbers. If anyone tells you Vermont’s application fee is $500, they are quoting the check casher and currency exchange fee, or a pre-2024 figure. The money transmitter fee is $2,100 — a $1,000 license fee and a $1,000 investigation fee under 8 V.S.A. § 2102(b)(10), plus the $100 NMLS processing fee, plus $25 for each authorized delegate location. Vermont’s costs are moderate, not cheap, and the reasons are worth understanding:

1. The bond has a floor, not a ceiling at $100,000 — $100,000 is the minimum; the actual requirement is 100% of your average daily Vermont money transmission liability, up to $2,000,000

2. Net worth is a sliding scale — $100,000 is the floor, but it climbs with total assets, and it is a tangible net worth test

3. The statute puts a clock on the regulator — the Commissioner must issue or deny within 60 days of a complete application

The Surety Bond: How Vermont Actually Calculates It

This is the single most misreported fact about Vermont, so read it carefully. Vermont does not have a flat $100,000 bond, and it does not have the old “$100,000 plus $10,000 per location, capped at $500,000” ladder you will still find on surety broker sites and in stale checklists. That ladder came from the pre-2024 statute.

Under 8 V.S.A. § 2541, the required security is a surety bond in a form satisfactory to the Commissioner (or, with the Commissioner’s approval, a deposit) in an amount equal to:

The greater of $100,000 or 100% of your average daily money transmission liability in Vermont, calculated over the most recently completed three-month period — capped at $2,000,000.

“Average daily money transmission liability” is defined at § 2503(2): your outstanding Vermont money transmission obligations at the end of each day, summed, divided by the days in the period, measured over calendar quarters. If you carry the maximum $2,000,000 bond, § 2541© relieves you of running the calculation at all.

A few practical points the statute makes explicit:

• The bond runs to the State for the benefit of claimants, and covers your authorized delegates as well as you (§ 2541(e))

• Claimants can sue the bond directly, or the Commissioner can sue on their behalf (§ 2541(f))

• Coverage must survive your exit — at least five years after you stop providing money services in Vermont, subject to the Commissioner reducing it as your outstanding obligations wind down (§ 2541(g))

• You may voluntarily post more than the maximum and count the excess as a permissible investment under § 2543(a)(5)

What you’ll actually pay: You don’t pay the full bond amount. You pay an annual premium — typically 0.5% to 1.5% of the face amount for applicants with good credit and clean backgrounds. Applicants with credit concerns, limited operating history, or higher-risk business models may pay 1.5–3%.

So on a $100,000 bond, your annual premium is typically $500–$1,500. On a $2,000,000 bond at volume, you are looking at an order of magnitude more — budget accordingly.

Why this matters for multistate operators: Vermont’s floor is low, and for a startup with modest Vermont volume the $100,000 minimum will govern for a long time. But do not build a nationwide bonding plan on the assumption that Vermont is a fixed $100,000 line item forever. As your Vermont liability grows, so does the bond, on a quarterly measurement cycle. Note also that Vermont’s own DFR licensing web page still displays the repealed per-location bond table. Where the DFR page and the statute conflict, the statute governs — § 2541 was enacted by Act 110 and took effect 1 July 2024.

Timeline: What 3–6 Months Actually Looks Like

Vermont is one of the few states that puts a statutory clock on the regulator. Under 8 V.S.A. § 2103©(1), if the Commissioner finds an applicant meets the standards, the license must issue not later than 60 days after the applicant submits a complete application. A denial must likewise be delivered within 60 days of completeness, with reasons (§ 2103(b)(2)). There is no deemed-approval provision — the clock creates an obligation, not an automatic license. And § 2103(e) cuts the other way: an application that remains incomplete for 120 days may be deemed abandoned.

The word doing the work in all of that is complete. Here’s a realistic month-by-month breakdown:

Pro tip: The 60-day clock in § 2103 only starts when your application is complete. Every RAI cycle you trigger is time spent outside the clock, not inside it. That is why front-loading documentation is the highest-leverage thing you can do here — and why an application left incomplete for 120 days can be deemed abandoned under § 2103(e), forfeiting your investigation fee. Vermont does not publish an RAI response window in statute; confirm the deadline the DFR gives you in writing rather than assuming 30 days.

Accelerated vs. Standard Processing: Vermont does not officially offer expedited processing, but applications demonstrating the following characteristics typically process toward the faster end of the timeline:

• Complete documentation submitted on day one

• Experienced management with prior financial services background

• Clean background checks across all principals

• Comprehensive, detailed AML/KYC compliance program

• Realistic, conservative financial projections

• Clear explanation of money transmission business model

Who Needs This License (And Who Doesn’t)

Vermont defines money transmission at 8 V.S.A. § 2503(17): selling or issuing payment instruments to a person located in Vermont; selling or issuing stored value to a person located in Vermont; or receiving money for transmission from a person located in Vermont. Act 110 expressly folded payroll processing services into the definition, and expressly excluded the provision solely of telecommunications services or network access. If you do any of the following activities, you need a Vermont license:

Activities That Require Licensing

• Money transfers — Accepting funds from one person and transmitting to another (domestic or international)

• Payment processing — Facilitating fund transfers between customers and merchants (if accepting customer funds)

• Digital wallets — Holding customer funds and enabling transfers or withdrawals

• Prepaid/stored value cards — Issuing or selling prepaid instruments used for fund transmission

• Cryptocurrency exchange — Buying, selling, or exchanging virtual currency on behalf of customers

• Crypto custody — Holding customer digital assets with transmission capabilities

• Virtual currency transmission — Any service transmitting virtual currency, including stablecoins

• Bill payment services — Accepting consumer funds and transmitting to billers

• Cross-border remittance — International money transfers (traditional or digital)

• Payroll processing — Receiving money to deliver wages, payroll taxes, benefit contributions or authorized deductions, unless you fit one of the narrow § 2504(18)–(20) carve-outs

Who Is Exempt

The exemptions live at 8 V.S.A. § 2504. They are a closed list. The ones that matter most:

• Federally insured banks and credit unions — § 2504(7); plus holding companies, foreign bank federal branches, Edge Act corporations, independent trust companies and Vermont special purpose financial institutions under § 2504(8)

• The United States and its agencies and instrumentalities — § 2504(4); the U.S. Postal Service and its agents, § 2504(5)

• State, county, city and other governmental agencies and their agents — § 2504(6)

• Broker-dealers registered under federal or state securities law — § 2504(12), to the extent of their operation as a broker-dealer; registered futures commission merchants, § 2504(11); designated contract markets, § 2504(10)

• Payment system operators — § 2504(1), to the extent of processing, clearing or settlement between exempt persons or licensees

• Agents of a payee — § 2504(2), but only if there is a written agreement, the payee holds the agent out publicly, and the payor’s obligation is extinguished on receipt by the agent so the payor bears no risk of loss

• Intermediary processors — § 2504(3), where a properly licensed or exempt entity carries the money transmission obligation, identifies itself to the sender in writing, and bears sole responsibility for making the sender whole

• Third-party service providers to banks — § 2504(14), where the bank assumes all risk of loss and legal responsibility

• Employees of a licensee, delegate or exempt person — § 2504(13), acting in scope and not as independent contractors

• Vermont-licensed debt adjusters — § 2504(16); stored value sold by public or nonprofit schools to their own students and employees, § 2504(15)

• Persons exempted by rule or order — § 2504(17), at the Commissioner’s discretion

Three “exemptions” that do not exist in Vermont. Insurance companies are not exempt. Money market mutual funds are not exempt. There is no general “traveler’s check and money order issuer” exemption — issuing payment instruments is precisely what the license covers. If a guide tells you otherwise, it is describing another state, or nothing at all. Note also that a broker-dealer is exempt only to the extent of its operation as a broker-dealer — the exemption does not travel with you into a separate transmission business.

Authorized delegates are not exempt — they are covered. An authorized delegate of a licensed money transmitter operates under the licensee’s license and the licensee’s bond (§§ 2525–2528, § 2541(e)). That is a sheltering arrangement, not an exemption, and the licensee remains on the hook for what its delegates do. Delegates are reported through NMLS UAAR, and cost $25 each at application and $25 each at renewal, capped at $3,500 a year.

You bear the burden of proving your exemption. 8 V.S.A. § 2504a expressly authorises the Commissioner to require any person claiming an exemption to demonstrate it. Claiming an exemption is a position you must be able to document on demand — not a default.

Crypto operators, pay attention: Vermont treats virtual-currency business activity as money transmission — § 2573(b) says so in one sentence. There is no separate “crypto license,” and no exemption for blockchain-based services as such. If you’re operating an exchange, custodial wallet, or any service taking control of customer virtual currency in Vermont, you need this license. The narrow crypto-specific exemptions at § 2572 are covered further down.

Payment processors: Analyze carefully. Vermont’s processor-adjacent exemptions at § 2504(2) and (3) are conditional, and the conditions are the whole game. Under § 2504(2) the payor’s obligation must be extinguished when you receive the funds, so the payor carries no risk if you fail to remit. Under § 2504(3) a licensed or exempt entity must have directly incurred the transmission obligation, must identify itself to the sender in writing, and must bear sole responsibility for making the sender whole. If you receive funds directly from consumers, hold them, or leave the consumer exposed to your failure, you are outside these carve-outs.

The Application: What Vermont DFR Actually Wants to See

Filing through NMLS involves completing several form types and uploading substantial documentation. Vermont’s DFR is known for clear, consistent expectations. Here’s what you’re walking into:

NMLS Forms

• MU1 (Company Form) — Entity information, business activities, contact details, financial condition, principals

• MU2 (Individual Form) — For each key individual and person in control: personal history, employment, education, background disclosure

• MU3 (Branch Form) — For each branch location the licensee owns and operates, including limited stations and mobile units ($20 NMLS processing fee each)

• UAAR — Authorized delegate locations are reported through Uniform Authorized Agent/Delegate Reporting, not on a separate form

Required Supporting Documents

Financial Package:

• Audited financial statements for the most recent fiscal year, and for the prior two years if available (§ 2102(e)(6))

• Unconsolidated financial statements for the current year, audited or not (§ 2102(e)(7))

• If publicly traded, the most recent Form 10-K; if a wholly owned subsidiary, the parent’s audited statements and 10-K or foreign equivalent (§ 2102(e)(8)–(9))

• Proof of tangible net worth meeting the § 2540 sliding scale — demonstrable at initial application by audited or unaudited statements (§ 2540(b))

• 3–6 months of business bank statements

• A list of material litigation over the preceding 10 years (§ 2102(d))

• Certificate of good standing and a Vermont registered agent (§ 2102(e)(2), (f))

• The name and address of any financial institution through which you plan to conduct money services (§ 2506(a)(7))

Compliance Package:

• Written AML/BSA program with detailed KYC procedures

• Suspicious Activity Reporting (SAR) procedures built to the federal MSB standard — Vermont does not set its own

• Designated compliance officer with resume and qualifications documented

• Customer Identification Program (CIP) with verification methodology

• OFAC sanctions screening procedures

• Employee training program outline and schedule

• Beneficial owner identification procedures

Operational Package:

• Detailed business plan (5+ pages) with financial projections and market analysis

• Technology systems description and security architecture

• Network security procedures and cybersecurity standards

• Customer complaint handling procedures

• Refund and cancellation policies

• Fee disclosure templates

• Disaster recovery and business continuity plan

• Data protection and privacy policies

Background Package:

• FBI fingerprints for all principals, officers, directors, and beneficial owners

• Signed authorization for background investigation

• Resumes/CVs for all key personnel

• Detailed disclosure of criminal history, regulatory violations, litigation, or bankruptcy

The AML program is critical — and let’s kill a myth while we’re here. Vermont does not set a SAR threshold. No state does. SAR obligations for money services businesses are federal, under 31 CFR 1022.320: an MSB must file a SAR on a transaction conducted or attempted at or above $2,000 that it knows, suspects, or has reason to suspect is suspicious. The $5,000 figure that floats around belongs to banks, not MSBs — quoting it at a money transmitter is a category error, and building your monitoring to it would leave a $3,000 gap in your filings. Vermont’s own contribution is § 2534, which requires licensees to file with the Commissioner any report the Bank Secrecy Act requires them to file federally. So: build to $2,000, and assume Vermont will read what you filed.

Don’t copy generic templates. Your AML program should demonstrate understanding of Vermont’s money transmission definition — including the payroll processing and virtual currency limbs — and specific procedures for detecting suspicious activity in your actual business model. DFR reads these closely.

Virtual currency procedures are mandatory. If your business touches cryptocurrency, your AML program must include specific procedures for: identifying beneficial owners of crypto accounts, monitoring for privacy coin usage or mixing, sanctions screening for wallet addresses, transaction pattern analysis specific to blockchain, and procedures for blacklisted or sanctioned addresses.

Vermont’s Net Worth Requirement

Vermont adopted the MTMA’s standard capital test essentially unmodified. 8 V.S.A. § 2540(a) requires a licensee to maintain at all times a tangible net worth of the greater of $100,000 or:

The test is tangible, and that word carries weight. Under § 2503(25), tangible net worth means aggregate assets excluding all intangible assets, less liabilities, determined under U.S. GAAP. Goodwill, capitalised software, brand value and similar intangibles do not count. This is a different and stricter test than a plain GAAP net worth test, and pages that describe Vermont as a “$100,000 net worth” state are describing only the floor.

Key points:

• $100,000 is a floor, not the requirement. A licensee with $200M in total assets needs $5,000,000 — $3,000,000 for the first $100M plus 2% of the next $100M

• Demonstrated at application by audited or unaudited financial statements (§ 2540(b), cross-referencing § 2102(e)) — Vermont does not force an audit for the net worth showing itself, though § 2102(e)(6) separately requires audited statements for your most recent fiscal year

• The Commissioner may exempt an applicant or licensee from § 2540 in whole or in part, for good cause shown (§ 2540©) — a genuine relief valve, and worth knowing exists

• Maintained continuously, not just at application — “at all times” is the statutory language

• Virtual currency on your balance sheet is a live question. § 2576 lets the Commissioner set limits on, and the method for, including virtual currency and virtual-currency-denominated assets in the net worth calculation. This provision exists because FTX and Celsius purported to capitalise themselves with their own tokens. If you plan to count crypto toward § 2540, raise it with DFR before you file

This capital is not a fee — it stays in your business. But do not assume the old “readily convertible to cash” gloss applies: the statutory test is tangible net worth under GAAP, not a liquidity test. Liquidity is addressed separately through the permissible investments regime at §§ 2542–2543, which requires you to hold permissible investments at least equal to your outstanding money transmission obligations.

Failure to maintain net worth: Vermont’s statute does not prescribe a specific self-reporting deadline or cure period for a net worth shortfall. It does make continuous compliance a licensing standard, and § 2110 gives the Commissioner authority to suspend, revoke, or refuse to renew a license where standards are not met. Treat a shortfall as an immediate escalation to counsel and to DFR rather than waiting for the next report of condition — and confirm the expected notification path with the Department directly.

Why Vermont Is a Strategic Gateway for Multistate Operations

If you’re building a multistate licensing strategy, Vermont deserves a prominent place. Here’s why:

Vermont is universally required. Money transmitter companies seeking national coverage must obtain licenses in all states where they operate. This means virtually every significant U.S. money transmitter is licensed in Vermont. A company licensed in 47 states but lacking a Vermont license raises red flags with examiners and other regulators.

Vermont’s core framework is now modern and legible. Act 110 rebuilt Chapter 79 on the CSBS model act in 2024, which means the licensing mechanics, definitions, prudential standards and permissible investments regime look like the ones you will meet in the other MTMA states. That is a real planning advantage. It is not the same thing as stability: Vermont has amended Chapter 79 in 2024 (Act 110), 2025 (Act 23) and 2026 (Act 142), each time tightening the virtual currency provisions. Assume the crypto side keeps moving.

The DFR coordinates with national regulators. Vermont’s DFR participates actively in the Conference of State Bank Supervisors (CSBS), the Money Transmitter Regulators Association (MTRA), and coordinates with federal agencies like FinCEN. This coordination ensures Vermont’s requirements align with national best practices while maintaining independent authority.

Processing has a statutory backstop. The 60-day decision requirement in § 2103©(1) is written into law, not published as a service target. That is more than most states offer, though it is not a deemed approval and it only runs from completeness.

Interstate coordination is strong — and statutory. Section 2103(f) authorises the Commissioner to accept the investigation results of a lead investigative state in a multistate licensing process, and to act as lead investigative state for others. Sections 2118 and 2127 provide for joint examinations and networked supervision. When multistate money transmitters are examined, regulators cross-check licenses across all states. Completeness in Vermont signals professionalism to examiners in other states.

After You’re Licensed: Ongoing Compliance Obligations

Getting the license is step one. Keeping it requires continuous, rigorous compliance.

Annual Obligations

• Annual renewal — this is not a perpetual license. Under 8 V.S.A. § 2109(a), on or before 1 December each year you must renew for the next calendar year and pay $1,000, plus $25 per authorized delegate location (total delegate fees capped at $3,500). § 2109(g) is blunt: a money transmitter that fails to pay the renewal fee on or before 1 December has its license automatically expire on 31 December. There is no published grace period. A license first issued on or after 1 November is valid through the following year (§ 2109(b))

• Annual assessment — On or before 1 April, a separate assessment of $0.0001 per dollar of money services activity performed for, or sold or issued to, Vermont customers in the year ending 31 December — minimum $100, maximum $15,000 (§ 2109©)

• Surety bond maintenance — Continuous coverage in the § 2541 amount, maintained with the Commissioner at renewal, and surviving for at least five years after you cease Vermont activity

• Annual report — Filed on or before 1 April, covering the preceding calendar year, under oath and in the form the Commissioner requires (§ 2120(a)). Late filing costs $1,000 for each month or part of a month past due, starting five business days after 1 April. Separately, financial statements are due within 90 days of your fiscal year end (§ 2120(b))

• Report of condition — Filed through NMLS as the Registry requires (§§ 2120©, 2530)

• Authorized delegate reporting — Ongoing UAAR reporting, plus notice of changes in delegates (§§ 2532–2533)

• Material change reporting — Notify the Commissioner of material changes as required by § 2108, and of any change of control under § 2107 (change of control filing fee: $500)

Continuous Obligations

• Suspicious Activity Reporting (SAR) — File with FinCEN within 30 calendar days of initial detection of facts constituting a basis for filing, on transactions at or above the federal $2,000 MSB threshold (31 CFR 1022.320). Vermont sets no threshold of its own; § 2534 requires you to file with the Commissioner any report the Bank Secrecy Act requires you to file federally

• Customer complaint tracking — Document all complaints, investigations, and resolutions

• Record retention — Vermont requires records under § 2546; the federal Bank Secrecy Act requires five years. Build to five, not three — the federal rule is the binding constraint for an MSB

• Change of location — Notice requirements under § 2545 before moving or adding a place of business

• Timely transmission, refunds, receipts and disclosures — Subchapter 9 (§§ 2560–2564) imposes affirmative duties on transmission timing, refunds, receipts, notice, and a specific disclosure regime for payroll processing services

• AML program maintenance — Continuous monitoring of effectiveness, employee training, procedures updates

Regulatory Examinations

The DFR has examination and investigation authority over money transmitter licensees under 8 V.S.A. § 2117, and may conduct joint or networked examinations with other states under §§ 2118 and 2127. Vermont does not publish an examination cycle — the statute grants the authority without fixing a cadence, so treat any “every 2–3 years” claim you read elsewhere as invention. Assume you can be examined and be ready for it.

You pay for it. Section 2117 provides for examination fees, and § 2102(g) makes the applicant bear the cost of any on-site investigation at the application stage. Budget for examination costs as a real, recurring, unpredictable line item.

Examination scope typically includes:

• Financial statements and capital adequacy verification

• Transaction records and processing controls testing

• AML program effectiveness and SAR filing validation

• Customer file sampling (verification of KYC procedures)

• Complaint handling procedures and dispute resolution

• Technology security and data protection measures

• Surety bond adequacy and proof of coverage

• Cybersecurity controls and incident response procedures

Build compliance into operations from day one. Money transmitters that lose licenses are the ones that treat compliance as an afterthought. Vermont’s DFR is known for professional examination practices, but deficiencies found during exams trigger remediation orders. It’s far cheaper to build proper controls upfront than to remediate after examination findings.

Virtual Currency & Cryptocurrency: Vermont’s Explicit Regulation

This is where Vermont diverges from every other MTMA state, and where most guides get it wrong.

When CSBS published the Money Transmission Modernization Act, its virtual currency provisions were offered as optional — drafted mainly for states that were not yet regulating crypto firms at all. Vermont had been regulating them under Chapter 79 for over six years already. So Vermont took the option, and then rewrote it. The Legislature’s own summary of Act 110 states it plainly: Subchapter 10 “differs substantively from the model law provisions on virtual currency.”

That is the fact to hold onto. Vermont is an MTMA state whose crypto subchapter is not the model act. If you are building a multistate crypto compliance matrix off the CSBS model, Vermont will not sit in the same column as the rest.

The architecture is simple, the detail is not. There is no separate “crypto license.” § 2573(b) says a person engaged in virtual-currency business activity is engaged in the business of money transmission — so you hold the same money transmitter license under Subchapter 2, and Subchapter 10 (§§ 2571–2577) layers additional obligations on top.

Vermont’s definition of virtual currency (§ 2503(27)) is a digital representation of value that is used as a medium of exchange, unit of account, or store of value, and is not money. That definition includes:

• Bitcoin and other cryptocurrencies

• Stablecoins (fiat-backed, crypto-backed, or algorithmic) — these are not government-issued, so they are not “money” and are therefore virtual currency

• Tokens used in DeFi protocols; wrapped and bridged tokens

And it expressly excludes:

• Money — § 2503(15) defines money as a medium of exchange issued by the United States or a foreign government, or a unit of account established by an intergovernmental organisation or by agreement between governments. A central bank digital currency issued by a government is money, not virtual currency. It falls under the ordinary money transmission limbs of § 2503(17), not Subchapter 10

• Customer affinity and rewards program units that cannot be converted into or redeemed for money, monetary value, bank credit or virtual currency (§ 2503(27)(B)(i))

• In-game currency usable solely within one publisher’s game or platform, with no outside market or convertibility (§ 2503(27)(B)(ii))

Virtual-currency business activity (§ 2503(29)) — the trigger — means exchanging or transferring virtual currency, virtual-currency administration, or virtual-currency storage; holding electronic precious metals or certificates representing interests in them; buying or selling virtual currency as a consumer business; or receiving virtual currency or control of virtual currency for transmission. There is a carve-out at the end of (29)(D) for transactions undertaken for nonfinancial purposes involving no more than a nominal amount.

Activities requiring licensing:

• Cryptocurrency exchange (fiat-to-crypto, crypto-to-fiat, crypto-to-crypto)

• Custodial wallet services and virtual-currency storage

• Crypto payment processing

• Stablecoin issuance or redemption (virtual-currency administration)

• Platforms with custody or transmission elements

• Blockchain-based remittance services

• Virtual-currency kiosk operation — subject to the moratorium described below

The crypto-specific exemptions (§ 2572) — narrow, and worth knowing:

• SEC/CFTC-governed activity — § 2572(a) disapplies Subchapter 10 to the extent the Securities Exchange Act of 1934 or the Commodity Exchange Act governs the activity and the person is conducting it in compliance with those laws

• De minimis — § 2572(b)(3) exempts a person whose virtual-currency business activity is reasonably expected to be valued, in aggregate, at $5,000 or less annually

• Personal use — § 2572(b)(2) exempts creating, investing, buying, selling, or accepting virtual currency solely on your own behalf for personal, family, household, or academic purposes

• Data storage and security vendors — § 2572(b)(1)(A), where they do not otherwise engage in virtual-currency business activity for others

• Securities and commodity intermediaries — § 2572(b)(4), if they do not engage in virtual-currency business activity beyond maintaining accounts and afford customers protections comparable to § 2575

• Own-funds testing — § 2572(b)(5), for a person testing products or services with its own funds

Note the direction of travel: these are exemptions from the subchapter, not blanket relief. § 2573(a)(3) requires that an exempt person “engages in no licensable activity outside the scope of such exemption.”

§ 2575 — custody rules that are Vermont’s own. This is the section where Vermont departed hardest from the model, and it was written with FTX, Celsius, Voyager, BlockFi and Genesis explicitly in mind. A licensee holding custody or control of customer virtual currency must:

1. Maintain custody and control of virtual currency of an identical type and amount sufficient to satisfy customer entitlements

2. Not satisfy that obligation with derivatives, digital depository receipts, or non-native wrapped or bridged tokens — if a customer deposits the native asset, you hold the native asset

3. Hold title in the customer’s name, with customer virtual currency not subject to the liens or claims of the licensee’s creditors

4. Not pledge, hypothecate, lend, or otherwise use customers’ virtual currency — rehypothecation is prohibited outright

5. Not use an unlicensed custodian to hold customer virtual currency

The Commissioner also has open-ended rulemaking authority under § 2575 to add consumer protection requirements as the industry changes.

§ 2576 — capital and antifraud. Two things live here. First, the Commissioner may set limits on, and the method for, including virtual currency and virtual-currency-denominated assets in a company’s net worth calculation. Second, § 2576 duplicates the antifraud provisions of the securities laws and applies them to any offer or sale of virtual currency — misstatements, insider trading, market manipulation — so DFR can act against fraud without first litigating whether the token is a security. It also requires virtual currency businesses to comply with all applicable state and federal law including securities and commodities laws; a breach of those laws is itself a violation of Chapter 79, exposing the license.

§ 2577 — the kiosk regime, and the moratorium you need to know about.

New virtual-currency kiosks cannot operate in Vermont before 1 July 2027. § 2577(f) imposed a moratorium, originally to 1 July 2026, extended to 1 July 2027 by Act 142 of 2026 (H.648), signed 16 June 2026. The moratorium does not apply to a kiosk that was duly licensed and operational in Vermont on or before 30 June 2024. If your business plan involves deploying crypto ATMs in Vermont, that door is closed for now — verify current status with DFR before spending a dollar on it.

For operators inside the grandfather, or planning past the moratorium, § 2577 (as amended by Act 23 of 2025) is among the most prescriptive kiosk statutes in the country:

• Daily cash limits: $2,000 per day for a new customer; $5,000 per day for an existing customer. A “new customer” is one whose first transaction with the operator occurred not more than 30 days prior (§ 2571(6)–(7))

• Fee cap: aggregate fees and charges — including the spread between the price charged and prevailing market value — may not exceed the greater of $5.00 or 15% of the U.S. dollar equivalent involved. A series of related transactions is deemed a single transaction

• Customer identification: government-issued ID, plus name, date of birth, telephone, address and email, plus a retained photograph of the customer for every transaction. No transacting under any identity but the customer’s own. Strict liability for violations of this subsection

• Mandatory live screening: the operator must speak by telephone with any new customer over 60 years of age before their first transaction, and with any customer attempting more than $5,000 in any consecutive 10-day period — identifying the customer, reconfirming attestations, discussing the purpose of the transaction and discussing virtual currency fraud schemes. Screenings must be recorded and retained, and approval depends on the operator’s assessment of the call

• Blockchain analytics: mandatory use of blockchain analytics software plus an established third-party analytics specialist, to prevent sends to wallets known to be affiliated with fraud. The Commissioner may demand evidence of current use

• Fraud refunds: a full refund, fees included, to a new customer fraudulently induced to transact, provided they notify the operator and a law enforcement or government agency within 90 days of their last transaction with the operator. Existing customers get a refund of all fees on the same notification terms

• Antifraud policy, Enhanced Due Diligence Policy and compliance policies — all written, all board-approved, with the EDD Policy required to identify individuals at risk of fraud based on age or mental capacity

• Two named officers — a full-time compliance officer and a full-time consumer protection officer, neither of whom may own more than 20% of the operator

• Live, toll-free telephone customer support during kiosk operating hours, displayed on the kiosk

• Live customer support and 24/7 availability aside, note § 2507 separately requires a licensee to register each money transmission kiosk and obtain the Commissioner’s prior approval for its activation, with prescribed on-screen fee and identity disclosures approved in advance and receipts after every transaction

Specific regulatory requirements for virtual currency services:

Beyond the statute, your AML program must specifically address:

1. Risk Management — Identification of smart contract risks, custody technology security, blockchain network failure procedures, disaster recovery for crypto systems

2. Enhanced AML/KYC — Beneficial owner identification for crypto accounts, high-risk crypto activity detection (privacy coins, mixing services), sanctions screening for wallet addresses, customer risk scoring specific to crypto

3. Compliance Monitoring — Transaction pattern analysis for unusual activities, procedures for blacklisted or sanctioned addresses, FinCEN guidance compliance, record-keeping for blockchain transactions

4. Custody and Control — Description of custody arrangements (hot wallet, cold storage, third-party custodian), private key security controls, insurance coverage for crypto held, customer access procedures, transaction dispute resolution

Federal coordination: Beyond Vermont’s state licensing, virtual currency service providers must also comply with FinCEN guidance on Virtual Asset Service Providers (VASPs). This includes implementing the “travel rule” requiring customer identification information with virtual currency transfers and maintaining adequate information-sharing standards with other VASPs.

Enforcement and Penalties for Non-Compliance

Vermont law provides significant enforcement authority to the DFR. Understanding violation categories and penalties helps prioritize compliance investments.

Administrative Penalties (8 V.S.A. § 2115(a)(1)): up to $10,000 per violation, plus the State’s costs and expenses of investigation and prosecution, including attorney’s fees. Section 2115(b) provides that each violation, and each failure to comply with a directive or order of the Commissioner, is a separate and distinct violation — which is how the number compounds. The Commissioner may also order restitution (§ 2115(a)(2)).

Criminal exposure — Vermont’s teeth are sharper than most:

• Unlicensed activity, or intentionally making a false statement, misrepresentation or false certification in a required record — a fine of up to $10,000, or imprisonment of up to three years, or both (§ 2115(d))

• Continuing to act as a licensee after a cease-and-desist order with an unsatisfied administrative penalty — a fine of up to $100,000, or up to one year in prison, or both (§ 2115©)

Section 2115(f) confirms these powers are in addition to any other enforcement authority, and § 2115(g) preserves the State’s ability to prosecute conduct that is otherwise a crime.

Other Enforcement Actions:

• License suspension or revocation

• Cease and desist orders

• Injunctions preventing operations

• Mandatory restitution to consumers

• Mandatory remediation orders with specific compliance requirements

Most common violations cited:

• Inadequate AML/KYC procedures (insufficient customer due diligence)

• SAR filing failures (failure to file, late filings, inadequate documentation)

• Bonding failures (lapsed bond, insufficient coverage, non-renewal)

• Net worth violations (falling below minimum, non-disclosure of decline)

• Record-keeping failures (missing transaction documentation, inadequate retention)

• Customer complaint mishandling (failure to respond, inadequate investigation)

Multistate Strategy: Where Vermont Fits

Most legitimate money transmitters operate in multiple states. Vermont occupies a unique position in licensing strategy:

Tier 1 Priority States (Apply to these first for national presence):

• New York — Largest financial market. The BitLicense and the money transmitter license are cumulative, not alternative: crypto activity triggers the BitLicense, fiat activity triggers the MTL. New York is not an MTMA state

• California — Largest population, fintech hub. Now on the MTMA sliding scale (A.B. 1116, effective 1/1/2024), and its separate crypto regime, DFAL, went live 1 July 2026

• Texas — Large population, significant remittance market. Chapter 151 is repealed — S.B. 895 (2023) replaced it with Chapter 152, the Money Services Modernization Act, effective 1 September 2023. The old “$100,000 for four or fewer locations / $500,000 if operating over the internet” rule no longer exists

• Florida — International money transfer hub, Latin American focus. Note Florida does not use NMLS

• Vermont — Universal requirement, strategic gateway, statutory 60-day clock

Why sequence matters: Vermont’s low bond floor and MTMA-standard net worth test make it manageable as an early state, and a genuinely useful proving ground: the § 2103 completeness standard forces you to build the documentation package properly the first time, which you will reuse everywhere else. The one place Vermont is not a gentle introduction is crypto — Subchapter 10 is Vermont-specific, stricter than the model act, and if kiosks are part of your plan Vermont is closed to new entrants until 1 July 2027.

NMLS simplifies multistate: Because Vermont uses NMLS — and does so by statute, under 8 V.S.A. §§ 2124–2125 — your application data, company information, and individual records are already in the system. Adding additional states becomes progressively easier. Be aware that not every state participates: Colorado and Florida do not use NMLS for money transmitter licensing, and Montana does not license money transmitters at all — it is the only state that doesn’t.

Total multistate cost context: There is no single correct count of jurisdictions, and any guide that gives you one confidently is guessing. What is verifiable: Montana is the only U.S. state that does not license money transmitters — South Dakota and Wyoming both do, contrary to a claim that circulates widely. A national footprint therefore means 49 states plus DC and the territories that license. Budgets scale accordingly, and the dominant variable is not the fee schedule — it is bonding and net worth in the states where your volume concentrates.

Vermont typically accounts for roughly $7,000–$36,000 of first-year costs and $6,000–$45,000 annually, per the tables above. The wide annual range is driven almost entirely by the § 2109© volume assessment, which runs from $100 to $15,000 depending on how much you move through Vermont.

Key Contacts & Resources

Download the Full Guide

This page covers the essentials. The complete guide goes much deeper — 1,390+ lines covering every section of the licensing process, from fundamental regulatory framework to AML program architecture to examination preparation to emerging regulatory trends.

Need Help With Your Vermont Application?

Faisal Khan LLC is a cross-border payments and licensing consultancy. We help fintechs, payment companies, remittance operators, and cryptocurrency businesses navigate money transmitter licensing across all 50 states, DC, and US territories.

If you need help with your Vermont money transmitter license application — or you’re building a multistate licensing strategy and want to do it right — get in touch.

© 2026 Faisal Khan LLC. All rights reserved. This page is for informational purposes only and does not constitute legal, financial, or regulatory advice. Money transmitter licensing requirements change — always verify current requirements with the Vermont Department of Financial Regulation directly. See our full disclaimer in the complete guide for details.

← See all US money transmitter license guides (all 50 states, DC & US territories)