Bitcoin ATMs that are often used for extortion and other fraudulent activities are being actively sought out and shut down by law enforcement agencies.
In the first two months of Q3 2024, over 600 BTC $56,716 Bitcoin ATMs went down worldwide, with the US reporting the highest number of closures. This occurs at a time when law enforcement is actively searching for and shutting down Bitcoin ATMs that are commonly used in fraud and extortion.
Based on data from Coin ATM Radar, the global Bitcoin ATM network lost 435 and 182 machines in July and August. The United States had the most significant statistical contribution, with a 411 and 258 ATM decline throughout the period.
Source: Coin ATM Radar
A Chico, California, municipal government committee discussed Bitcoin ATM regulation on August 7. The County of Butte’s top administrative officer, Andy Pickett, discussed the proposal to regulate these ATMs and suggested treating them “more like a bank.”
Since 2020, the number of scams employing Bitcoin ATMs has increased tenfold, according to the United States Federal Trade Commission (FTC). Fraudsters have exploited the secrecy and speed of cryptocurrency transactions. Crypto ATMs let customers buy cryptocurrencies with their cards, such as Bitcoin, and look like regular cash dispensers.
Bitcoin ATM fraud is increasing.
According to FTC data, losses from Bitcoin ATM scams exceeded $110 million in 2023, and the likelihood of targeting those 60 years of age and beyond was three times higher. Individual con artists usually use false or deceptive promises to convince victims to transfer their money using Bitcoin ATMs.
According to Coin ATM Radar statistics, as of September 5, 38,790 crypto ATMs are operating globally.
The US and Canada account for over 91% of all Bitcoin ATM networks worldwide.
Source: Coin ATM Radar
Twenty-eight thousand six hundred ninety-one crypto ATMs, or almost 74% of all ATMs, are operated by the top 10 operators. Bitcoin Depot informed Cointelegraph that it “posts scam warnings” on its kiosks and “has screen prompts that warn customers of scam potentials.” Bitcoin Depot operates 8512 (21.9%) machines, the most significant number of ATMs.
Increased crackdowns in various jurisdictions
Germany’s Federal Financial Supervisory Authority started a crackdown on cryptocurrency ATMs on August 20 and took possession of 13 machines out of 35 locations. German authorities have cautioned that if operators of cryptocurrency ATMs fail to implement appropriate Know Your Customer protocols for transactions above 10,000 euros, these ATMs may become focal points for illicit activities.
Singapore has outlawed cryptocurrency ATMs as well. The action is a part of the Monetary Authority of Singapore’s larger initiative to control public cryptocurrency advertising.
