Cryptocurrency ATM fraud losses surpassed $65 million in just the first half of 2024, according to the US Federal Trade Commission. This staggering figure underscores how fraudsters are increasingly exploiting crypto ATMs as a loophole. The FTC points out that consumers over the age of 60 are the hardest hit by these schemes. Across all age groups, the median loss reported for the first half of 2024 is estimated at a whopping $10,000.

"Bitcoin ATMs are machines that look like a traditional ATM and are often found at convenience stores, gas stations and other high-traffic areas. Instead of distributing cash, they accept cash in exchange for cryptocurrency. Their use by scammers, who urge consumers to deposit cash into them to "protect" their savings, is on the rise," the agency said.

The FTC warns that most scammers using crypto ATMs impersonate government officials or tech support representatives from well-known companies. They often convince victims to urgently withdraw funds from their bank accounts and deposit them through a crypto ATM. Once the victim scans a QR code provided by the fraudster, the funds are transferred directly to the scammer's cryptocurrency wallet.

The FTC urges consumers to exercise extreme caution when using crypto ATMs. "Don’t believe anyone who says you need to use a Bitcoin ATM, buy gift cards, or move money to protect it or fix a problem. Real businesses and government agencies will never do that – and anyone who asks is a scammer," agency experts noted. "If you think it could be legitimate, contact the company or agency, but look up their number or website yourself. Don't use the phone number the caller or message gave you," they added.

Since 2019, criminals have processed at least $160 million in illicit transactions through crypto ATMs, data from TRM Labs revealed. Against this background, US authorities are stepping up their efforts to combat the growing fraudulent activity involving digital assets. Thus, in 2023, California legislators proposed a bill to enforce a $1,000 daily withdrawal limit at cryptocurrency ATMs in an effort to curb scam activity.