Australia’s financial crimes regulator has issued a strong warning to crypto ATM operators, raising concerns over inadequate anti-money laundering and counter-terrorism financing measures.
The Australian Transaction Reports and Analysis Centre (AUSTRAC) released a statement on Monday, outlining findings from its crypto taskforce, which has detected suspicious activities linked to these machines. Formed in December 2024, the taskforce has uncovered troubling patterns, including potential connections to fraud and scams.
Brendan Thomas, CEO of AUSTRAC, emphasized that the taskforce, consisting of experts in regulation, enforcement, and intelligence, has been actively working with businesses to ensure compliance with Australia’s financial laws. “The taskforce has been busy engaging with businesses to understand the risks in their sector and assess their compliance with the law,” Thomas stated. “It has identified worrying trends and indicators of suspicious activity, including transactions that may be linked to scams or fraud.”
The warning from AUSTRAC comes amid growing international scrutiny of crypto kiosks. In the United States, lawmakers are advocating for stricter regulations on these machines following a rise in fraud cases, particularly those targeting elderly victims.
Crypto ATMs, also known as kiosks, enable users to buy or sell digital currencies like Bitcoin using cash or cards. Unlike traditional financial institutions, these machines often operate with minimal identity verification requirements, making them susceptible to misuse. AUSTRAC initially focused its efforts on these kiosks but has since broadened its scope to address broader compliance issues within the crypto sector.
“We want to ensure crypto ATM providers have robust practices to minimize the risk that their machines can be used to launder dirty money or to scam and defraud innocent people,” Thomas said.
Under Australia’s Anti-Money Laundering and Counter-Terrorism Financing Act, all Digital Currency Exchanges, including those operating crypto ATMs, must be registered with AUSTRAC. These businesses are required to conduct Know Your Customer (KYC) checks, monitor transactions, and file Suspicious Matter Reports. Additionally, they must report cash transactions exceeding AU$10,000 to regulatory authorities.
Australia has the highest number of crypto ATMs in the Asia-Pacific region, with over 1,648 machines currently in operation—a dramatic increase from just 23 in 2019 and 60 in 2022. Sydney alone hosts 348 of these kiosks. Despite the rapid expansion of these machines, most transactions conducted at crypto ATMs still involve cash deposits to purchase Bitcoin.
As regulatory scrutiny intensifies, crypto ATM operators will face increasing pressure to strengthen their compliance frameworks. The evolving landscape underscores the ongoing challenge of balancing financial innovation with the need for regulatory oversight.
By Alejandro Silva Ramírez, Crypto Analyst & Columnist