Bloomberg Says Australian Crypto ATM Number Spikes by 16-Fold in Two Years

A recent Bloomberg report showed that Australia is seeing a remarkable surge in the number of cryptocurrency automatic teller machines (ATMs), positioning it as one of the fastest-growing markets globally for these digital kiosks.

In just two years, the number of crypto ATMs in the country has soared dramatically, increasing from a modest 73 to an impressive tally of almost 1,200.

This growth has caused debate over the demand for such services and their potential risks. Crypto ATMs offer users the convenience of depositing cash in exchange for digital assets directly into their wallets, or vice versa, enabling them to withdraw physical currency from the sale of their cryptocurrency tokens.

While the United States remains the largest market with approximately 32,000 machines, and Canada follows with about 3,000, Australia has rapidly climbed to third place.

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Expansion Fueled by North American Operators: What is Going On In Australia?

Operators claim that these ATMs offer greater financial inclusion by providing easy access to digital currencies, a view supported by rapid growth in the number of machines.

However, this expansion has sparked controversy. Critics contend that the widespread availability of crypto ATMs heightens the risk of money laundering and fraud.

Angela Ang, a senior policy adviser at blockchain intelligence company TRM Labs, underscores that Australian authorities have recognized crypto ATMs as a potential vulnerability in the fight against money laundering.

TRM Labs reports that the cash-to-crypto industry has processed at least $160 million in illicit transactions globally since 2019. Meanwhile, Chainalysis Inc. estimates that Australia alone saw around $223 million in illegal digital asset activity from 2022 to 2023.

A recent report has revealed that scammers are increasingly exploiting crypto ATMs and kiosks in their fraudulent schemes. These perpetrators lure victims into depositing cash into these machines, which swiftly convert the funds into digital currency, enabling swift and often untraceable transfers, frequently to offshore accounts.

⛔ Scammers are increasingly incorporating cryptocurrency ATMs and kiosks into their fraudulent schemes.#Scam #Cryptohttps://t.co/Ra2M8hhLiX

— Cryptonews.com (@cryptonews) August 27, 2024

A recent case also noted that a victim was tricked into depositing nearly $5,000 into a Bitcoin ATM, and scammers demanded gift cards to settle a fabricated debt. Such incidents are becoming more common, especially among older individuals, with over 2,000 complaints filed in 2023 alone.

Concerns over scams have prompted several prominent Australian banks to impose restrictions on transactions involving digital asset exchanges.

Notably, much of Australia’s crypto ATM market growth has been driven by North American providers expanding their footprint overseas.

Firms such as Bitcoin Depot Inc., a U.S.-based company, are poised to deploy over 200 additional kiosks across Australia, pending regulatory approval.

Local factors have also contributed to the rise of crypto ATMs in Australia. This penchant for betting spills over into the cryptocurrency market, where speculation on digital coins has attracted significant interest.

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The Future of Crypto ATMs in Australia And Globally

The swift expansion of crypto ATMs has garnered the attention of Australian regulators, who are navigating the delicate balance between fostering innovation in digital finance and mitigating the risks associated with illicit activities.

The Australian Transaction Reports and Analysis Centre (AUSTRAC) enforces mandatory registration for all digital currency exchange providers to operate legally within the country’s borders.

Meanwhile, the Australian Taxation Office has prioritized addressing technology-enabled financial crime, particularly in response to concerns about using ATMs for money laundering.

A recent report also indicated that the UK has brought its first prosecution related to crypto ATM operations, charging Habibur Rahman with running unregistered crypto ATMs and laundering £300,000 ($395,000).

This case follows a police raid in 2023 at an electronics shop, where multiple ATMs were seized. The Financial Conduct Authority (FCA) banned crypto ATMs in 2022, eliminating their presence in the country.

Rahman’s case is part of a broader global effort to regulate the cash-to-crypto industry, which has processed at least $160 million in illicit transactions since 2019.

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