Missouri AG Takes Action: $114 Million Lost to Crypto ATM Scams Exposed
Resumen Ejecutivo
- Missouri Attorney General’s recent actions highlight a staggering $114 million lost to crypto ATM scams in 2023, primarily targeting vulnerable populations.
- The FTC reports that fraud losses involving crypto ATMs have surged from $12 million in 2020 to $114 million in 2023.
- Increased regulatory scrutiny could reshape how crypto ATMs operate, affecting user security and investment decisions.
Missouri Attorney General Andrew Bailey has launched a statewide investigation into crypto ATM operators following the discovery that $114 million was lost to scams through these machines in 2023, exposing systemic failures in consumer protection.
The magnitude of this financial scandal is particularly alarming when contextualized within the broader crypto ATM market. The global crypto ATM market was valued at USD 356.72 million in 2025 and is projected to reach USD 18,127.56 million by 2034, exhibiting a CAGR of 54.80% during the forecast period. North America dominated the market in 2025 with a share of 88.70%, making the region particularly vulnerable to the regulatory and consumer protection failures now being exposed in Missouri.
Adults aged 60 and older accounted for 86 percent of reported losses in cases where the victim’s age was known. In Washington, D.C., victims’ median age using Athena Bitcoin ATMs was 71. These demographic patterns suggest a deliberate targeting of elderly individuals who may be less technologically savvy or more trusting of financial transactions, regardless of the medium used.
Bailey’s investigation was prompted by numerous complaints from Missouri residents who reported losing substantial sums through crypto ATM transactions. The complaints detailed deceptive fee structures, unclear exchange rates, and a lack of adequate customer support when attempting to recover funds. The AG’s office has subpoenaed several major crypto ATM operators, including Bitcoin Depot and Athena Bitcoin, demanding documentation of transactions, fee structures, and anti-fraud measures implemented.
The Flawed Narrative: Consumer Protection in the Crypto ATM Space
Despite claims of consumer protection, investigations reveal that companies like Athena Bitcoin profit from scams targeting vulnerable residents, undermining public trust.
The D.C. Attorney General’s office has been particularly aggressive in its pursuit of crypto ATM operators, filing a lawsuit against Athena Bitcoin that alleges the company “knowingly facilitated fraud against elderly and vulnerable District residents.” The lawsuit contends that Athena’s business model effectively profits from criminal activity through exorbitant fees charged on scam transactions, creating a perverse incentive structure where the company benefits from consumer exploitation.
Scott Buchanan, former CEO of Bitcoin Depot, has attempted to reposition the industry narrative by stating that “as crypto ATMs become more integrated into the retail financial technology landscape, the sector is now focused on strong industry standards, consistency, and transparency.” However, evidence from multiple state investigations suggests that these standards remain largely aspirational rather than operational realities.
The financial incentives for crypto ATM operators are particularly troubling. Investigations have revealed that crypto ATM companies often mark up the price of cryptocurrency by 20% to 30% or more on transactions, including illicit ones. This means that when an elderly victim deposits $1,000 into a crypto ATM to send to a scammer, they might only receive $700-$800 worth of cryptocurrency, with the operator pocketing the difference. This markup, when combined with the sheer volume of scam transactions, represents a significant revenue stream for these companies.
In Washington, D.C., an investigation found that 93% of all Athena BTM deposits were the direct result of scams. Similarly, in Iowa, an investigation found that at least 95 percent of transactions at Bitcoin Depot and CoinFlip machines were fraudulent. These statistics suggest that for many crypto ATM operators, legitimate transactions are the exception rather than the rule, with the bulk of their business coming from illicit activities.
D.C. Attorney General Brian L. Schwalb has been particularly vocal about the industry’s failures, stating: “Athena’s bitcoin machines have become a tool for criminals intent on exploiting elderly and vulnerable District residents.” This characterization is supported by internal communications obtained during investigations, which show some crypto ATM operators were aware of the high incidence of fraud but continued to operate with minimal intervention.
The KYC/AML Compliance Gap: A Major Oversight
The industry’s weak KYC/AML compliance measures are creating a welcoming environment for fraud, with insufficient checks allowing scammers easy access.
KYC (Know Your Customer) and AML (Anti-Money Laundering) regulations are designed to prevent financial institutions from being used for illicit activities. However, crypto ATM operators have historically operated in a regulatory gray area, with minimal oversight and enforcement. This has allowed scammers to exploit these machines for money laundering, terrorist financing, and other illicit financial flows.
Iowa Attorney General Brenna Bird has taken a particularly aggressive stance on this issue, suing Bitcoin Depot and CoinFlip in 2025 after an investigation found that at least 95% of transactions at their machines were fraudulent and cost Iowans about $20 million in less than three years. Bird emphasized that “consumer protection laws won’t prevent all crypto ATM–related fraud, so enforcement is also key,” suggesting a multi-faceted approach to regulatory oversight.
The compliance failures are particularly evident in the identity verification processes at many crypto ATMs. While some machines do require basic identification, the verification standards are often minimal compared to traditional financial institutions. This allows scammers to create multiple accounts and conduct numerous transactions without detection. Additionally, the cash-based nature of many crypto ATM transactions makes them particularly attractive for money laundering, as they provide a mechanism to convert illicit cash into cryptocurrency without a clear audit trail.
The opacity of blockchain transactions further complicates the regulatory landscape. While blockchain provides a permanent record of transactions, the pseudonymous nature of many cryptocurrency wallets makes it difficult to trace the ultimate beneficiaries of funds passed through crypto ATMs. This has led to growing concerns that these machines are being used to launder money obtained through other criminal activities, with crypto ATMs serving as a crucial link in the money laundering chain.
The regulatory response to these compliance gaps has been inconsistent across jurisdictions. Some states have implemented stricter requirements for crypto ATM operators, including mandatory registration, transaction monitoring, and reporting requirements. However, these regulations vary significantly from state to state, creating a patchwork of oversight that operators can exploit by relocating operations to jurisdictions with lighter regulatory burdens.
The Elder Fraud Epidemic: A Disproportionate Impact
Elderly individuals are disproportionately affected, with scammers exploiting their trust and leading to devastating financial losses.
The demographic data from multiple state investigations reveals a clear pattern of targeting elderly individuals through crypto ATMs. In Washington, D.C., victims’ median age using Athena Bitcoin ATMs was 71, with many victims in their 80s and 90s. These elderly victims often have significant life savings that they’ve accumulated over decades, making them particularly attractive targets for scammers.
The scams targeting elderly individuals through crypto ATMs typically follow a pattern. Scammers often pose as government officials, tech support representatives, or family members in distress, convincing victims that they need to send cryptocurrency to resolve a supposed emergency or avoid legal consequences. Once the victim agrees to send the funds, the scammer directs them to a nearby crypto ATM, where the victim deposits cash and receives cryptocurrency in return.
The median amount lost per scam transaction in D.C. was $8,000, with one victim losing $98,000 in nineteen transactions. These losses represent a devastating financial blow for many elderly individuals, who may rely on these savings for retirement healthcare and other essential expenses.
The psychological impact of these scams is equally significant. Elderly victims often experience profound shame and embarrassment after being scammed, which prevents them from reporting the crime or seeking help. This creates a vicious cycle where scammers continue to target elderly individuals with confidence that their victims will not report the crimes to law enforcement.
The industry’s response to this epidemic has been inadequate. Crypto ATM operators have implemented minimal safeguards to protect elderly customers, relying instead on disclaimers and general warnings that are unlikely to deter determined scammers or vulnerable individuals. Some operators have argued that implementing additional verification measures would create privacy concerns or operational inefficiencies, prioritizing convenience over consumer protection.
The absence of meaningful industry standards has left elderly customers particularly vulnerable. Unlike traditional financial institutions, which have decades of experience protecting elderly customers from fraud, crypto ATM operators have largely operated without established best practices or regulatory guidelines specifically designed to protect this vulnerable population.
The Regulatory Future: A Shift Toward Accountability
With growing scrutiny from regulators, the future of crypto ATMs may involve stricter compliance measures, affecting operational costs and consumer access.
The regulatory landscape for crypto ATMs is rapidly evolving as state attorneys general and federal agencies increase their scrutiny of these operations. In December 2025, Missouri Attorney General Catherine Hanaway launched a statewide investigation into companies operating cryptocurrency kiosks, citing concerns about deceptive fee structures and the use of these machines by bad actors to defraud consumers. This follows similar actions by attorneys general in Washington, D.C., and Iowa, indicating a coordinated approach to addressing the systemic issues in the crypto ATM industry.
Missouri has a particular history with cryptocurrency regulation. In 2014, the Missouri Department of Revenue determined that an ATM provider is not required to collect sales tax on Bitcoin transfers through an ATM, because sales and use taxes are imposed solely on items of tangible personal property. More recently, in 2022, Missouri modernized its money laundering statute to include cryptocurrency within its definition of “monetary instruments.” These regulatory developments suggest that Missouri is increasingly positioning itself as a jurisdiction with serious oversight of cryptocurrency activities.
The bankruptcy of Bitcoin Depot, a leading US operator of Bitcoin ATMs, further underscores the industry’s challenges. The company filed for voluntary Chapter 11 bankruptcy protection in 2025, citing mounting regulatory pressure and financial strain. This bankruptcy filing reveals the financial fragility of many crypto ATM operators, who may struggle to comply with increasing regulatory requirements while maintaining profitability.
At the federal level, regulatory agencies are beginning to develop more comprehensive frameworks for overseeing crypto ATM operations. The Financial Crimes Enforcement Network (FinCEN) has issued guidance emphasizing that crypto ATM operators are money transmitting businesses subject to Bank Secrecy Act requirements. This means that operators must implement robust KYC/AML programs, file suspicious activity reports, and maintain transaction records.
The regulatory shift is likely to have significant operational implications for crypto ATM operators. Stricter compliance measures will increase the cost of doing business, potentially leading to consolidation within the industry as smaller operators struggle to meet new requirements. Additionally, increased regulatory scrutiny may deter some investors from supporting crypto ATM startups, further constraining growth in the sector.
Despite these challenges, increased regulation may ultimately benefit the industry by improving consumer trust and legitimacy. As compliance standards become more uniform and robust, crypto ATMs could evolve from their current status as fringe financial services to more mainstream payment options. However, this transition will require significant investment in compliance infrastructure and a fundamental reorientation of business priorities away from facilitating illicit transactions toward serving legitimate customer needs.
The Bottom Line
The increasing fraud linked to crypto ATMs can’t be ignored; the industry must prioritize transparency and consumer safety.
The magnitude of the crypto ATM fraud problem is staggering. The FTC found that fraud losses involving crypto ATMs jumped from about $12 million in 2020 to $114 million in 2023. More recent data suggests that cryptocurrency kiosk scams led to more than $389 million in reported losses in 2025. This exponential growth in fraud losses reflects both the increasing prevalence of crypto ATMs and the industry’s failure to implement adequate safeguards against illicit activities.
The demographic impact of these scams is particularly concerning. Adults 60 and older accounted for 86 percent of reported losses in cases where the victim’s age was known. This concentration of losses among elderly individuals suggests a pattern of deliberate targeting that requires a targeted regulatory response. Current consumer protection frameworks have been insufficient to address this specific vulnerability, highlighting the need for industry-specific safeguards.
The financial incentives for crypto ATM operators remain misaligned with consumer protection interests. Companies like Athena Bitcoin and Bitcoin Depot have profited from facilitating scam transactions through exorbitant fees, creating a business model that rewards rather than punishes illicit activity. Until these incentives are realigned through regulatory intervention or market pressure, the industry is unlikely to voluntarily implement the changes necessary to protect consumers.
Investors and users should demand stricter regulations and robust consumer protection measures from crypto ATM operators. This includes mandatory identity verification, transparent fee structures, mandatory cooling-off periods for first-time users, and dedicated customer support channels for fraud reporting. Additionally, operators should be held liable for facilitating scam transactions, creating a financial incentive to implement more effective anti-fraud measures.
As Missouri shows, the future of crypto ATMs hinges on accountability—it’s time for the industry to step up or face the consequences.
Methodology and Sources
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