In a sweeping regulatory response, AUSTRAC — Australia’s financial intelligence agency — has launched a crackdown on cryptocurrency ATMs (CATMs) following a surge in scam activity and money laundering involving these machines. The move comes after a three-month investigation that found crypto ATMs are being exploited by criminal syndicates to funnel funds offshore.
Crypto ATMs: A Growing Risk Vector
Crypto ATMs, which allow users to deposit or withdraw cryptocurrency in exchange for cash, have been gaining popularity across Australia, with hundreds of machines operating in convenience stores and shopping centres. But their ease of access and anonymity have also made them a prime tool for scammers.
According to AUSTRAC, Australians, particularly elderly victims, have lost millions annually after being tricked into sending funds through these ATMs to offshore scam networks, particularly in Asia and Europe.
The investigation revealed:
Numerous scams were facilitated through CATMs
Operators often lacked compliance with anti-money laundering (AML) regulations
At least one operator had their registration refused rfor enewal due to serious breaches
New Regulations to Tackle Crypto Crime
To mitigate these risks, AUSTRAC has implemented new industry-wide controls that apply to all crypto ATM operators:
$5,000 transaction cap on all cash deposits and withdrawals
Mandatory ID verification and customer checks
On-screen scam warnings for users
Tighter transaction monitoring and real-time suspicious activity alerts
AUSTRAC CEO Brendan Thomas said the measures are aimed at “protecting individuals from scams by deterring criminals from directing them to a crypto ATM, as well as to protect businesses from criminal exploitation” (ABC News).
Part of a Larger Scam Epidemic
The changes come amid a broader wave of crypto-related scams across Australia. In 2023 alone, Australians lost over $300 million to investment scams, with cryptocurrency featured prominently. This follows reports of overseas scam syndicates operating with alarming sophistication, often targeting Australians via fake investment platforms, phone calls, and text messages.
An earlier ABC report noted that crypto scams have been some of the most financially damaging, with victims frequently coerced into using CATMs to make anonymous transfers.
What It Means for Crypto Users and Operators
For law-abiding users, the new rules may mean a little extra friction, but they aim to make the space safer. For businesses operating crypto ATMs, there’s a clear message: comply or be shut down. Operators are now expected to implement banking-level compliance standards, including robust AML programs and customer verification systems.
These changes are also a sign that regulatory scrutiny on digital assets is tightening. While the technology continues to evolve, regulators are drawing clear lines around the responsibilities of service providers.
