A growing wave of fraud involving crypto ATMs (also called Bitcoin ATMs or kiosks) has cost Americans tens to hundreds of millions of dollars in recent years. According to the U.S. Federal Trade Commission (FTC), losses from these scams have surged almost tenfold since 2020, with over $110 million lost in 2023 alone.
In just the first six months of 2024, Americans reported losing around $65 million to these ATM-related frauds.
Key Trends & Who’s Most Affected
- Older adults (60+) are disproportionately victimized: they are more than three times as likely to report losses from crypto ATM scams compared to younger people
- The median reported loss in such scams is about $10,000.
- The scams often involve impersonation of government bodies, banks, or tech support agents. Scammers create urgent or threatening scenarios, telling victims that their accounts are compromised or that they face fines or legal issues unless they transfer funds via a crypto ATM.
How These Scams Operate
Here’s the typical modus operandi:
- Initial contact & fear trigger: The victim receives a call, email, text, or pop-up warning that something is wrong—bank fraud, tax issues, or legal trouble. Scammers pose as officials or tech support.
- Urgent instruction: Victims are instructed to withdraw cash and go to a Bitcoin ATM to convert that cash to cryptocurrency, typically using a QR code provided by the scammer. The funds are then transferred directly into the scammer’s wallet.
- Limited chance of recovery: Because cryptocurrency transactions are irreversible and often involve wallets outside U.S. jurisdiction, retrieving the funds becomes very difficult once the transfer is complete.
Impacts & Concerns
- Financial losses: Many individuals lose life savings or large sums, especially older people who might be less familiar with crypto and more susceptible to urgency in scams.
- Emotional and psychological harm: Victims report high stress, shame, and confusion. Once the funds are gone, many feel there’s no recourse.
- Regulatory gap: Crypto ATMs are less regulated than banks; consumer protections, transparency requirements, and transaction limits are often lacking.
What’s Being Done & What Can Help
- The U.S. Congress has considered legislation (for example, the Crypto ATM Fraud Prevention Act) aimed at increasing oversight, requiring warnings, transaction limits, and clearer fraud disclosures for crypto ATM operators.
- The FTC and other agencies are issuing public warnings, especially targeting older Americans. Awareness campaigns are ongoing.
- Some states are pushing for rules requiring clear signage on crypto ATMs warning of fraud risk, and for operators to implement monitoring for suspicious activity.
What Consumers Should Do to Stay Safe
- If you get an unexpected call or message saying your bank or government account is compromised, hang up and verify independently (use known official numbers).
- Never move large sums of cash to a crypto ATM in response to threats or urgings over the phone or via messages.
- Be skeptical of QR codes or links provided by callers; check that the ATM is legitimate and ask for help or advice if unsure.
- Talk to family members or trusted friends before acting on urgent instructions.
- Report suspicious incidents to the FTC, local law enforcement, or consumer protection agencies.
Outlook
The trend suggests crypto ATM scam losses will continue growing unless more robust regulation, better consumer protection, and enforcement measures are implemented. With the population aging and more people exposed to crypto, the vulnerability remains high.
