Australian Crypto ATM Numbers Soar by 16-Fold in Two Years: Bloomberg

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Hassan Shittu

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Hassan Shittu

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Hassan, a Cryptonews.com journalist with 6+ years of experience in Web3 journalism, brings deep knowledge across Crypto, Web3 Gaming, NFTs, and Play-to-Earn sectors. His work has appeared in...

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August 28, 2024

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

In just two years, the number of crypto ATMs in the country has skyrocketed from a mere 73 to nearly 1,200. This growth has caused debate over the demand for such services and their potential risks.

Crypto ATMs allow users to deposit cash to receive digital assets in their wallets or withdraw physical currency from the sale of 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.

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, the expansion has been controversial. Critics argue that the proliferation of crypto ATMs increases the risk of money laundering and fraud.

Angela Ang, a senior policy adviser at blockchain intelligence firm TRM Labs, notes that Australian authorities have identified crypto ATMs as a money laundering vulnerability.

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.

According to a recent report, Scammers increasingly use crypto ATMs and kiosks in their schemes. They direct victims to deposit cash into these machines, which convert the money into digital currency and allow for rapid, untraceable transfers, often to overseas accounts.

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.

Even several major Australian banks have imposed restrictions on transactions with digital asset exchanges due to concerns over scams.

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

Companies like Bitcoin Depot Inc., a U.S.-based company, are preparing to deploy over 200 additional kiosks across Australia, awaiting a regulatory green light.

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.

The Future of Crypto ATMs in Australia And Globally

The rapid proliferation of crypto ATMs has drawn the attention of Australian regulators, balancing the need for innovation in digital finance with concerns over illicit activity.

The Australian Transaction Reports and Analysis Centre (AUSTRAC) mandates that all digital currency exchange providers register with the agency to operate legally in the country.

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.