More Than 600 Bitcoin ATMs Closed In 2 Months, Here's Why!

More than 600 Bitcoin ATMs are closed in 2 months (Photo; Doc. Coin ATM Radar)

JAKARTA - In the last two months, more than 600 Bitcoin ATMs worldwide have been reported offline, with the biggest decline occurring in the United States. The move comes as authorities are increasingly active in closing Bitcoin ATMs involved in extortion and fraud cases. This closure sparked widespread attention, especially due to the large number of fraud cases involving transactions through Bitcoin ATMs.

According to data from Cointelegraph, according to data from Coin ATM Radar, in the third quarter of 2024, the global Bitcoin ATM network lost 435 engines in July and 182 engines in August. The United States recorded the largest number of closures, with a reduction of 411 ATMs in July and 258 ATMs in August. This number of declines is the most significant among other countries.

This law enforcement effort is driven by an increase in fraud cases that take advantage of the anonymous nature and speed of crypto transactions. Bitcoin ATMs, which are similar to ordinary ATM machines, allow users to buy crypto assets such as Bitcoin using their debit or credit cards.

Local governments in various countries have begun to tighten regulations related to Bitcoin ATM operations. For example, on August 7, 2024, a government committee in Chico, California, discussed the need for stricter regulation of Bitcoin ATMs, even proposing that ATMs be treated like banks. This step was taken in response to an increase in fraud that uses crypto ATMs as the main tool.

Data from the United States Federal Trade Commission (FTC) shows that since 2020, there has been a ten-fold increase in fraud cases involving Bitcoin ATMs. Losses caused by Bitcoin ATM fraud reached more than 110 million US Dollars (approximately IDR 1.69 trillion) by 2023, with age groups 60 years and over being the main target.

Not only in the United States, but firm action against crypto ATMs is also taking place in other countries. On August 20, 2024, the German Financial Supervisory Authority raided crypto ATMs, confiscating 13 machines from 35 different locations. German authorities warned that crypto ATMs could be a hotbed of criminal activity if strict Know Your Customer (KYC) controls are not enforced for transactions above 10,000 euros (approximately IDR 171 million).