Bitcoin ATMs: Convenient for Some, Costly for Others

Bitcoin ATMs (or BTMs) have become a common sight in convenience stores, gas stations, and other high-traffic areas over the past few years. For many, they offer a convenient way to buy or send cryptocurrency. However, for scammers, BTMs have become a lucrative tool for theft. Data from the FTC Consumer Sentinel Network reveals that fraud losses at BTMs have surged nearly tenfold from 2020 to 2023, reaching over $65 million in just the first half of 2024. Given that most frauds go unreported, the actual damage is likely much higher.

Cryptocurrency has rapidly gained popularity as a payment method for various scams, especially fake investment opportunities. BTMs have contributed to the rise of crypto as a preferred payment method for many other scams, including government impersonation, business impersonation, and tech support scams. Reports indicate that when people use BTMs in these scams, their losses are typically substantial. In the first half of 2024, the median loss reported was $10,000.

Demographic Insights on BTM Fraud

Older adults, particularly those aged 60 and over, are disproportionately affected by BTM-related fraud. In the first half of 2024, they were more than three times as likely as younger adults to report a loss using a BTM. Over two-thirds of the total reported losses from these machines were incurred by older adults.

How BTM Scams Work

BTM scams often begin with a call or message about suspicious activity or unauthorized charges on an account. Some scams start with a fake security warning on a computer, impersonating companies like Microsoft or Apple. These alarming messages aim to prompt immediate action. The scammers’ narrative often escalates quickly, with threats that all your money is at risk or that your information is linked to criminal activities like money laundering or drug smuggling. They may even introduce a fake government agent to intensify the urgency.

Scammers instruct victims to withdraw cash from their bank and deposit it into a nearby BTM, often a specific one. They provide a QR code to scan at the machine, and once the cash is deposited, it goes directly into the scammer’s wallet.

Protect Yourself from BTM Scams

To avoid falling victim to BTM scams, follow these tips:

• Never click on links or respond directly to unexpected calls, messages, or pop-ups. If you think a message might be legitimate, contact the company or agency using a number or website you look up yourself.
• Take your time. Scammers want to rush you. Before taking any action, talk to someone you trust.
• Never withdraw cash in response to an unexpected call or message. Only scammers will ask you to do this.
• Don’t believe anyone who tells you to use a Bitcoin ATM, buy gift cards, or move money to protect your funds or fix a problem. Real businesses and government agencies will never make such requests.

For more information on spotting and avoiding scams, visit ftc.gov/scams. If you encounter a scam, report it to the FTC at ReportFraud.ftc.gov.