People are losing a lot more money to Bitcoin ATM scams. In a report released on Tuesday, the Federal Trade Commission said it found the amount of money lost to Bitcoin ATM scams increased nearly 10 times from 2020 to 2023 — going from $12 million to a whopping $114 million. Consumers have already lost $65 million to the ruse in the first half of 2024 alone.
Over the years, scams have evolved into different versions of pretty much the same thing: schemes that trick victims into paying scammers. We’ve seen bad actors trick people into sending wire transfers, buying gift cards, and even handing over a pile of cash in a shoebox. This is the Bitcoin ATM variation.
Bitcoin ATMs are the physical machines that you can use to purchase or sell cryptocurrency at places like gas stations and grocery stores. To carry out their scheme, scammers contact a victim by phone, text, or through online pop-ups. They’ll then impersonate a bank or government official while attempting to convince their victim that their bank account has been compromised and that they need to take action.
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Image: FTC
Scammers will then instruct their victims to take out a large sum of cash and deposit it into a Bitcoin ATM — which the FTC says scammers may call “safety lockers” — to keep their funds secure. Once at the Bitcoin ATM, scammers will send their victim a QR code to scan at the machine, which will put all of the victim’s cash into the scammer’s crypto wallet.
This year, victims reported losing a median of $10,000 to Bitcoin ATM scams. The FBI warned about this scheme in 2021, and since then, Vermont and Minnesota have enacted laws putting daily transaction limits on crypto kiosks. As is the case with other scams, it’s always important to verify that the email or phone call you receive from a purported company or financial institution is legitimate, and you should never withdraw money based on instructions from a random interaction.
There are other crypto scams on the rise, too, with deepfake crypto scams popping up on YouTube, bad actors impersonating journalists to drain victims’ digital wallets, and “pig butchering” scams that have led to the arrest of a former bank CEO who stole millions to invest in a phony crypto scheme.