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Law enforcement authorities worldwide are intensifying efforts to shut down Bitcoin ATMs implicated in extortion and fraudulent activities. In the initial two months of the third quarter of 2024, over 600 Bitcoin ATMs were deactivated globally. The United States led these shutdowns, reflecting a significant portion of the reductions.
Data from Coin ATM Radar indicates that the global {Bitcoin} (BTC)ATM network saw a decrease of 435 machines in July and 182 machines in August. Notably, the United States reported a reduction of 411 ATMs in July and 258 in August. On August 7, Chico, California's local government committee deliberated on the regulation of Bitcoin ATMs, suggesting they should be regulated similarly to financial institutions.
The Federal Trade Commission (FTC) has reported a tenfold increase in scams involving Bitcoin ATMs since 2020. These scams exploit the anonymity and rapidity of cryptocurrency transactions. Bitcoin ATMs function like standard cash machines but enable users to acquire cryptocurrencies via their cards. The FTC's data reveals that losses from Bitcoin ATM scams exceeded $110 million in 2023, with individuals aged 60 and older being disproportionately affected. Scammers typically persuade victims to transfer funds through Bitcoin ATMs under false pretenses.
As of September 5, Coin ATM Radar data indicates that approximately 38,790 crypto ATMs are operational worldwide, with the United States and Canada together accounting for about 91% of the total network. The top 10 operators manage 28,691 crypto ATMs, representing roughly 74% of the global total. Bitcoin Depot, the largest operator with 8,512 machines, has implemented measures to address these issues, including scam warnings and on-screen prompts at its kiosks.
In response to the rising concerns, Germany’s Federal Financial Supervisory Authority began a crackdown on August 20, seizing 13 machines from 35 locations. German officials have emphasized the necessity for operators to enforce rigorous Know Your Customer controls for transactions exceeding 10,000 euros. Similarly, Singapore has enacted a ban on crypto ATMs as part of a broader regulatory effort by the Monetary Authority of Singapore to control cryptocurrency-related advertising to the public.
