Criminals are cashing in on bitcoin ATMs around the country, using the convenient, largely anonymous transactions for drug trafficking, money laundering and a variety of fraud, law enforcement officials say.
The machines, mostly located in convenience stores and owned by private companies, allow customers to easily buy bitcoin and other cryptocurrencies using cash. The funds are then sent to that customer’s crypto wallet.
But that convenience also means easy money for fraudsters.
The fraud, according to law enforcement, has become more pervasive as bitcoin ATM installations in the U.S. have skyrocketed in recent years. More than 26,000 machines stand today, a spike from 4,212 in January 2020, according to Coin ATM Radar. Well-known companies such as Walmart and Circle K have started installing them.
The number of bitcoin ATMs in the US has risen to more than 26,000.
The FBI warned last week of fraud schemes using cryptocurrency ATMs and quick response, or QR, codes to facilitate payments.
“The FBI has seen an increase in scammers directing victims to use physical cryptocurrency ATMs and digital QR codes to complete payment transactions,” the bureau said in a public service announcement. QR codes can be used at the crypto ATMs to direct payments to intended recipients.
Here’s how this particular fraud works, according to the FBI: “The scammers provide a QR code associated with the scammer’s cryptocurrency wallet for the victim to use during the transaction. The…