Bitcoin ATM Scams Surge Tenfold Since 2020, FTC Reports
Bitcoin ATM scams are surging, with fraudsters increasingly exploiting these machines to deceive vulnerable individuals. The Federal Trade Commission (FTC) reports a nearly tenfold increase in Bitcoin ATM-related scams since 2020, with losses surpassing $110 million in 2023 alone.
Emma Fletcher, a senior data researcher at the FTC, highlighted that scammers are using these machines more frequently to swindle people. “Scammers are using these machines as a way to take money from people more than we’ve seen in the past,” she told NBC News.
Older adults are particularly affected, with those over 60 more than three times as likely to fall victim to these scams compared to younger people. Scammers typically convince victims to use Bitcoin ATMs under false pretenses, such as preventing identity theft or securing their accounts.
As Bitcoin’s value has risen, so has cryptocurrency fraud. Fletcher noted that $2 out of every $3 lost in these Bitcoin ATM scams came from individuals near or over retirement age, indicating that Bitcoin ATMs have become a gateway for targeting older adults.
Bitcoin ATMs, which function similarly to traditional ATMs but deal with cryptocurrency transactions, have become more common across the U.S., with nearly 32,000 machines now in operation, up from about 4,000 in early 2020. Their placement in busy areas like convenience stores and gas stations has contributed to the increase in fraud, according to federal authorities.
Scammers often pose as customer service representatives, government officials, or tech company employees, convincing victims that their accounts are compromised. They then send QR codes linked to digital wallets, instructing victims to scan the codes and deposit cash into Bitcoin ATMs, believing they are safeguarding their assets. Instead, the funds are quickly transferred to the scammers.
On August 7, a local government committee in Chico, California, discussed regulating Bitcoin ATMs to treat them more like banks. Andy Pickett, the chief administrative officer of Butte County, explained that each jurisdiction would need to pass its own ordinance, though such measures are expected to face legal challenges.
