A group of U.S. Senate Democrats, led by Majority Whip and Senate Judiciary Committee Chair Dick Durbin, is urging major cryptocurrency ATM operators to address the rising fraud targeting elderly Americans. Seven Democratic senators, including Elizabeth Warren, issued a statement on September 12 calling on 10 of the country’s largest crypto ATM firms to tackle growing financial losses from Bitcoin ATMs (BTMs). Data from the Federal Trade Commission (FTC) shows that fraud linked to these machines reached $65 million in the first half of 2023, prompting concerns about older Americans being three times more likely to fall victim to BTM-related scams than younger adults.
The senators specifically highlighted the vulnerability of elderly Americans, urging companies like Bitcoin Depot, CoinFlip, RockItCoin, Bitstop, Coinhub, Unbank, Athena Bitcoin, Byte Federal, Cash2Bitcoin, and Margo to take immediate action to curb fraud schemes that disproportionately affect seniors. These firms have been instrumental in placing BTMs in various locations, paying businesses to host the machines. Criminals have been contacting, threatening, and coercing elderly Americans into depositing large sums of money into their crypto wallets using Bitcoin ATMs, prompting the senators to call for swift action to prevent such scams.
According to a July report by the Illinois Times, a business owner removed a Coinhub ATM after realizing that most users were victims of scams. The senators also referenced a New York Times article detailing multiple cases of scammers coercing older adults into transferring funds through crypto ATMs. The lawmakers requested the companies to respond by October 4, detailing the measures they are taking to prevent fraud, including providing scam warnings, imposing transaction and deposit limits, and offering fraud insurance for depositors. The surge in crypto ATM fraud has surged tenfold since 2020, jumping from $12 million to $144 million as reported by the FTC.
The FBI also reported a significant increase in crypto fraud, with $5.6 billion lost in 2023, a 45% increase from the previous year. Scammers are increasingly using crypto ATMs and kiosks in their fraudulent schemes, exploiting these digital currency exchange points to swindle unsuspecting victims. Despite the surge in fraud, the popularity of crypto ATMs continues to grow globally. Australia, for example, has seen a significant increase in the number of crypto ATMs from 73 to nearly 1,200 in just two years. The United States remains the largest market with around 32,000 machines, followed by Canada with approximately 3,000 machines, indicating the widespread use and accessibility of these devices for cryptocurrency transactions.
