Bitcoin ATM Growth May Be a Boon for Money Launderers

Bitcoin ATM Growth May Be a Boon for Money Launderers


As the number of ATMs soars, one crypto analytics firm suggests they are increasingly being used to sidestep anti-money laundering (AML) controls.

In its , published earlier this month, analytics company CipherTrace found bitcoin ATMs were frequently used to send funds to “high-risk exchanges” – trading platforms the company considers to be known for facilitating criminal activity and money laundering.

“The percentage of funds sent to high-risk exchanges from U.S. BATMs [bitcoin ATMs] has seen exponential growth, doubling every year since 2017.” the report reads. While approximately 2% of U.S. transactions went to high-risk exchanges in 2017, that number is now knocking at the 8% mark.

While they may somewhat resemble a cash-based machine, a bitcoin ATM enables people to buy and sell bitcoin as well as other cryptocurrencies directly from an exchange, using bank cards or even hard cash. Crucially, users don’t need to have a digital wallet: The machines create them, providing users with printouts of the wallet addresses and private keys.

CipherTrace also highlighted that the vast majority of U.S. bitcoin ATM transactions in 2019, around 88%, sent funds to offshore destinations.

“[B]itcoin ATMs are likely to be the next major regulatory target,” the report predicts.

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