In 2025, several cryptocurrency ATMs became the focus of law enforcement scrutiny, with various states taking measures against operators of Bitcoin ATMs amid a growing concern over scams linked to these machines. The heightened attention from authorities and lawmakers aimed to address the increasing prevalence of fraud facilitated by crypto ATMs in the United States. Some officials resorted to extreme measures, utilizing power tools to dismantle machines, while two attorneys general initiated lawsuits against leading players in the industry. In addition, consumer alerts were issued to protect vulnerable populations, particularly the elderly.
Operators of crypto ATMs argue that their services play a crucial role in enabling individuals to purchase digital assets such as Bitcoin using cash. However, detractors maintain that these companies should take stronger measures to safeguard elderly customers from falling victim to scams, even if such actions might negatively affect their business model.
The Internet Crime Complaint Center reported that last year, Americans lost $246 million due to crypto ATMs, marking a staggering 99% increase from the previous year. Notably, approximately 43% of these losses were incurred by individuals aged 60 and above. The modus operandi of these scams is quite straightforward: older Americans withdraw cash from their banks, convert it to cryptocurrency at ATMs, and subsequently send the funds to scammers impersonating government officials, business representatives, or tech support agents. Some scams, however, have taken more inventive forms, such as one in Massachusetts where residents were deceived into making crypto payments for alleged jury duty failures.
Due to the irreversible nature of cryptocurrency transactions, it becomes exceedingly difficult for victims to recover their funds once the scammers vanish. Furthermore, the fine print in user agreements associated with these ATMs has emerged as an additional challenge for victims seeking justice. For instance, the Iowa Supreme Court ruled in two cases this year that a crypto ATM operator retained the right to the cash involved in fraudulent transactions, citing that users must confirm ownership of the digital wallet receiving the funds, rather than allowing third-party access. “Once that transaction is completed, when the user inserts their cash and their crypto is funded into the wallet of their choosing, that ends our involvement in the transaction,” explained Chris Ryan, the chief legal officer of Bitcoin Depot, to Decrypt in June. While Bitcoin Depot collaborates with local law enforcement to trace victims’ cryptocurrency, Ryan noted that authorities breaking into the machines often create additional victims, resulting in property damage and lost cash multiple times a year.
A notable incident occurred earlier this month when sheriffs in Jasper County, Texas, used tools to break into a Bitcoin Depot kiosk located at a gas station, recovering $32,000 in cash that the company claimed was rightfully theirs.
Pressure on Crypto ATM Operators
In Iowa, Bitcoin Depot and rival CoinFlip have come under scrutiny from Attorney General Brenna Bird. In February, she filed a lawsuit against both companies, alleging they profit from scam victims while imposing “massive, hidden transaction fees.” This concern regarding undisclosed fees was subsequently echoed by Washington, D.C. Attorney General Brian L. Schwalb, who filed a lawsuit against Athena Bitcoin in September. Schwalb alleged that residents in the federal district were subject to fees as high as 26%, which were not made clear to them.
Schwalb’s lawsuit accused Athena of taking advantage of elderly individuals while violating consumer protection laws, arguing that the warnings displayed on the machines were ineffective, given the circumstances under which victims approached them. The lawsuit emphasized that “elderly scam victims standing terror-stricken in gas stations, pockets stuffed with uncomfortable amounts of cash, do not understand what it means to ‘generate’ a cryptocurrency wallet or have their own ‘personal Bitcoin wallet.’” An Athena representative expressed to Decrypt that the company strongly opposes the claims and intends to defend itself in court. Bitcoin Depot and CoinFlip denied the allegations made in Bird’s lawsuit, highlighting their own measures such as ID checks and refund policies.
This year, Senator Dick Durbin (D-IL) introduced the Crypto ATM Fraud Prevention Act, which aims to establish strict transaction limits on crypto ATMs and requires companies to provide full refunds to fraud victims who report their losses within a designated timeframe. Durbin described the legislation as featuring “common-sense guardrails” designed to protect elderly individuals; however, the bill has not advanced since its introduction in the Republican-controlled Senate in February.
Despite the lack of progress on federal regulations regarding crypto ATMs, over a dozen states have taken steps to draft or enact laws addressing transaction limits, scam warnings, refund policies, and new licensing requirements, according to AARP. In June, the nonprofit organization, which focuses on issues affecting older Americans, reported that 20 states had taken action to combat the increase in scams related to crypto ATMs, noting their ongoing efforts to collaborate with lawmakers in other states to implement similar protective measures. At that time, city officials in Spokane, Washington, had passed a ban on crypto ATMs, impacting approximately 50 kiosks in the area.
In August, Illinois became the first state in the Midwest to enact legislation aimed at reducing fraud associated with crypto ATMs, mandating that operators register with state authorities, capping transaction fees at 18%, and limiting daily transactions for new users to $2,500. During the same month, the Treasury Department’s Financial Crimes Enforcement Network issued a warning regarding crypto ATMs, stating that “the risk of illicit activity is exacerbated” by operators who fail to adhere to proper procedures under the Bank Secrecy Act.
As of mid-November, approximately 30,750 crypto ATMs were operational across the United States, accounting for 78% of the global total, according to Coin ATM Radar. Yet, the overall number of machines worldwide has remained around 40,000 since 2022. While local governments in the U.S. have pursued regulations on crypto ATMs, some countries have adopted more comprehensive measures. For instance, New Zealand banned crypto ATMs nationwide in June as part of its efforts to curtail criminal financing.
