Australia has experienced a dramatic surge in the number of crypto ATMs over the past two years, with the count increasing 17 times. This rapid expansion has positioned Australia as one of the fastest-growing markets for these machines.
This expansion has continued amidst ongoing concerns about their potential misuse by malicious actors. Coin ATM Radar recently revealed that Australia now boasts 1,162 crypto ATMs, a significant leap from 67 machines in 2022.
Australia’s Crypto ATM Boom Signifies Growth but Raises Money Laundering Concerns
Australia has emerged as the third-largest market for cryptocurrency ATMs worldwide, with an additional 160 ATMs since the end of April this year. This impressive growth underscores the country’s increasing interest in cryptocurrency and its adoption among consumers and businesses.
Moreover, the recent addition of 160 new ATMs highlights a continued expansion trend. This comes shortly after Australia surpassed the milestone of having over 1,000 active crypto ATMs.
In a blog post, Blockchain intelligence firm TRM Labs described this recent surge as the most significant expansion in the cash-to-crypto industry in the last few years.
However, despite this rapid growth, Australia still holds a relatively small share of the global market. It boasts only a 3% share of the total crypto ATMs worldwide. On the other hand, the United States dominates the market with over 82% of the global share, equating to 31,877 ATMs.
Canada follows with a 7.8% share and 3,004 machines. This difference gap underscores the massive scale of the U.S. market compared to Australia’s growing but minor presence.
The notable increase in crypto ATMs in Australia has not gone unnoticed by law enforcement. TRM Labs pointed out that Australian authorities have flagged these kiosks as a potential vulnerability for money laundering activities.
This concern arises because some criminals might exploit crypto ATMs to launder illicit funds, given that cryptocurrency transactions are relatively anonymous.
In response to these concerns, the Australian Federal Police (AFP) launched a multi-agency money laundering task force in March of the previous year.
The task force aimed to address the risks associated with crypto ATMs and other financial technologies that could be used to obscure illegal activities.
Also, the AFP’s initiative reflects the efforts to ensure that the expanding crypto infrastructure does not facilitate crime.
Crypto ATMs Process $160M in Illicit Transactions, Prompting Global Regulatory Crackdowns
Since 2019, crypto ATMs have processed over $160 million in illicit transactions, which has raised significant concerns among global authorities and regulators.
According to TRM Labs, these machines are particularly vulnerable to money laundering due to their use of cash. They also mostly do not require an account to operate.
Also, the cash-to-crypto industry, dominated by crypto ATMs, had illicit volumes that made up 1.2% of its total volume last year. This figure is double the rate seen across the broader ecosystem.
Scams accounted for most of these illicit transactions in 2023, funneling over $30 million into fraud-linked wallets. This figure translates to almost 80% of the total illicit volume.
However, regulators in some countries have taken decisive actions against crypto ATMs due to concerns about their potential misuse. In Germany, the financial watchdog seized 13 crypto kiosks from 35 locations on August 20.
Similarly, last year, the United Kingdom’s Financial Conduct Authority (FCA) shut down 26 unlicensed crypto ATMs, reducing the number of active machines by 90%.
Disclaimer: The opinions expressed in this article do not constitute financial advice. We encourage readers to conduct their own research and determine their own risk tolerance before making any financial decisions. Cryptocurrency is a highly volatile, high-risk asset class.
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