Providers of cryptocurrency ATMs have been cautioned by the Australian Transaction Reports and Analysis Centre (AUSTRAC) that those failing to fully comply with anti-money laundering regulations may face legal repercussions.
In a press release dated March 31, the crypto task force of AUSTRAC noted the emergence of suspicious transactions and potential fraud, expressing concern over the escalating prevalence of crypto ATMs. Since December, the task force has collaborated with industry players to ensure compliance with anti-money laundering and counter-terrorism financing guidelines.
Brendan Thomas, the CEO of AUSTRAC, issued a stern warning, emphasizing that while the agency aims to assist businesses in enhancing compliance, non-compliance with anti-money laundering and counter-terrorism financing laws will lead to penalties.
“We will continue to work with the industry to elevate standards, but we will also take action against operators who don’t comply.”
— Brendan Thomas, AUSTRAC CEO
Australia currently boasts the largest crypto ATM market in the Asia-Pacific region, with approximately 1,648 machines, a significant increase from just 23 in 2019 and 60 in 2022. Sydney alone has 348 of these ATMs, most of which allow cash deposits for Bitcoin (BTC) purchases, increasing the risk of misuse for illicit fund transfers.
AUSTRAC reports that some Australians have lost their entire life savings due to the exploitation of cryptocurrency ATMs in fraud and scams.
Crypto ATM operators must register with AUSTRAC and comply with AML/CTF guidelines, which involve monitoring transactions, verifying customer identities, and reporting any suspicious activities. AUSTRAC has indicated that companies failing to meet these requirements may face hefty fines and has committed to enhancing its enforcement measures.
This enforcement initiative comes at a time when the global crypto ATM market is experiencing a downturn due to regulatory pressures. A recent report indicated that over 1,000 Bitcoin ATMs were deactivated worldwide in February, with the total count decreasing by 2,062 since late 2022.
The United States leads the global crypto ATM sector, operating over 78% of ATMs, followed by Canada at 9.2%. Australia and Europe each represent just over 4% of the international network.