The US network of Bitcoin ATMs is facing an existential regulatory reckoning as federal data identifies the machines as a primary conduit for financial fraud.

Americans reportedly lost more than $333 million in 2025 through scams routed via cryptocurrency kiosks.

According to reports, the FBI recorded over 12,000 complaints linked to the machines between January and November 2025.

FinCEN’s data points to a worsening trend, with reports of Bitcoin ATM-related fraud nearly doubling from a year earlier.

As a result, regulators are now reframing the nation’s footprint of roughly 31,000 kiosks, often located in gas stations and convenience stores. They increasingly view that network as a systemic risk rather than a consumer education issue.

Notably, the machines offer scammers a path of least resistance by bridging the gap between recoverable cash and irreversible cryptocurrency.

Scammers typically call victims and direct them to a physical location to deposit cash.

After the machine converts the cash to Bitcoin and the victim sends it to the scammer’s wallet, the transfer becomes irreversible. That bypasses the chargeback protections built into the traditional banking system.

Meanwhile, the financial damage is disproportionately concentrated among older demographics.

FBI data indicates that individuals over age 60 account for a significant share of losses. They are frequently targeted by “tech support,” government impersonation, or “urgent problem” scripts that leverage the physical ubiquity of the kiosks.

In response, US agencies like the Department of Financial Protection and Innovation (DFPI) have stepped up public guidance efforts. Notably, the financial agency recently issued a “Protect Yourself” framework to address the surge in Bitcoin ATM fraud.

“No legitimate organization will ever ask you to deposit cash into a crypto ATM to resolve an issue or protect your money.
If someone makes this request, it’s a scam,” DFPI stated.

At the same time, policymakers are increasingly viewing education as insufficient, shifting from warnings to strict regulation.

For example, countries like Australia have introduced legislation to set daily transaction limits and ban the proliferation of the machines.

Considering this, industry analysts view these structural guardrails as a critical step to slowing the momentum of Bitcoin ATM fraud.

Read original story Bitcoin ATMs Face Regulatory Reckoning After $330 Million in US Scam Losses by Oluwapelumi Adejumo at beincrypto.com