Bitcoin ATM Scams Skyrocket: Victims Lose $114 Million in 2023 as Fraudsters Pose as Officials
Staff Editor Bitcoin ATM Scams Surge, Costing Victims Millions
A recent report from the Federal Trade Commission (FTC) has revealed a dramatic increase in Bitcoin ATM scams, with losses skyrocketing from $12 million in 2020 to $114 million in 2023. The trend shows no signs of slowing, as the first half of 2024 alone has already seen $65 million in losses.
These scams represent the latest evolution in fraudulent tactics, following a long line of schemes involving wire transfers, gift cards, and even cash hidden in shoe boxes. Bitcoin ATMs, physical machines that allow users to buy and sell cryptocurrency, have become the new tool of choice for scammers.
The typical scam begins with fraudsters contacting potential victims via phone, text, or online pop-ups. Impersonating bank or government officials, they convince targets that their bank accounts have been compromised. Victims are then instructed to withdraw large sums of cash and deposit them into Bitcoin ATMs, which scammers often refer to as “safety lockers.”
Once at the ATM, victims are directed to scan a QR code, unknowingly transferring funds directly to the scammer’s cryptocurrency wallet. The FTC reports that the median loss per victim is a staggering $10,000.
In response to the growing threat, regulatory bodies and law enforcement agencies are taking action. The FBI issued a warning about these scams in 2021, and states like Vermont and Minnesota have enacted laws to limit daily transactions at crypto kiosks.
Experts advise the public to verify the legitimacy of any communications from companies or financial institutions and to be wary of requests to withdraw money based on random interactions.
As Bitcoin ATM scams continue to rise, other cryptocurrency-related frauds are also emerging. These include deepfake scams on YouTube, impersonation of journalists to access digital wallets, and sophisticated “pig butchering” schemes. Recently, a former bank CEO was arrested for involvement in a phony cryptocurrency scheme, further highlighting the diverse and evolving nature of these financial threats.
